CALGARY, Alberta (Reuters) - Canadian spot natural gas prices rose on Thursday as temperatures cooled in big markets even though a key storage report showed inventory draws were lighter than expected.
Spot gas at the AECO storage hub in southeastern Alberta rose 5 Canadian cents to average C$3.65 a gigajoule. Deals were done between C$3.58 and C$3.70 a GJ.
Although temperatures in most big markets have cooled, boosting heating demand, near record amounts of stored gas have kept prices in check.
In its weekly report, the U.S. Energy Information Administration said gas inventories fell last week by 23 billion cubic feet to 3.814 trillion cubic feet, less than the 26 bcf draw forecast by a Reuters poll.
In Canada, stocks fell 17.7 bcf, or 2.7 percent, last week to 627.2 bcf, Canadian Enerdata reported.
Canadian storage facilities ended the week 90 percent full. A year earlier they stood at 92 percent of capacity.
Temperatures in southern Alberta will be below the seasonal average low of -12 Celsius (10 Fahrenheit) on the weekend, dropping to as low as -17C (1F) on Sunday, and will then warm, with lows of -1C (30F) expected on Tuesday, according to Environment Canada.
Toronto low temperatures are expected to be under the -4 C (25 F) average through Monday, the agency said.
AccuWeather.com expects temperatures in the U.S. Northeast and Midwest, key gas consuming regions, to average below normal for the next two weeks.
The New York Mercantile Exchange January natural gas contract rose 7.4 cents to settle at $4.343 per million British thermal units, with cold weather forecasts propping up prices despite a weekly inventory draw that fell slightly short of market expectations.
Supplies on Alberta’s main pipeline system ran at 15.63 bcf, 8 million cubic feet above the target linepack set by operator TransCanada Corp.
Producers delivered 9.06 bcf to the system and a net 1.76 bcf was withdrawn from Alberta storage facilities.
In exports, spot gas prices at Niagara, Ontario, averaged $4.77 per mmBtu, up 16.
Gas at Huntingdon-Sumas on the British Columbia-Washington border rose 5 cents to average $4.29 per mmBtu.