U.S. natgas futures near flat early ahead of EIA stocks data

Thu May 23, 2013 9:26am EDT
 
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NEW YORK, May 23 (Reuters) - U.S. natural gas futures traded
nearly flat early on Thursday after slipping slightly in the
prior session, with volume light as traders stepped back ahead
of a weekly inventory report due later in the morning.
    Traders and analysts polled by Reuters expect to see that
domestic gas stocks rose last week by 91 billion cubic feet when
the U.S. Energy
    Inventory builds have exceeded market expectations for three
straight weeks as mild May weather slowed overall demand, but
traders said warmer forecasts for next week and into early June
were likely to slow injections.
    "Market chatter continues to focus on forecasts for warmer
than normal temperatures as a source of ongoing support for
prices," Citi Futures energy analyst Tim Evans said in a report.
    At 9:10 a.m. EDT (1310 GMT), front-month gas futures 
on the New York Mercantile Exchange were down 0.5 cent at $4.181
per million British thermal units after trading overnight
between $4.163 and $4.223.
    Chart traders said the market seemed stuck in a range, with
good support in the $3.90 area and resistance in the $4.20s.
    But with supplies still comfortable, many traders remain
skeptical of the upside, at least until a broader-based heatwave
forces more air-conditioning loads.    
    Mostly below-seasonal temperatures are expected for the
eastern half of the country for the next five days, but private
forecaster Commodity Weather Group said the six- to 10-day
outlook had turned hotter again for the central and eastern
United States.
    Despite a steep decline in dry gas drilling over the last
year and a half, production has not slowed much, if at all. The
EIA still expects output in 2013 to post a record high for a
third straight year.