Natural gas plunges to 11-week low as mild weather forecasts weigh

            Natural gas futures tumbled to the lowest level since late-August on Monday, as meteorologists predicted milder weather that would limit heating fuel demand.

Natural gas prices have closely tracked weather forecasts in recent weeks, as traders try to gauge the impact of shifting outlooks on early-winter heating demand. 

On the New York Mercantile Exchange, natural gas futures for delivery in December traded at USD3.440 per million British thermal units during U.S. morning trade, down 2.1%. 

Nymex gas prices tumbled to a session low of USD3.408 per million British thermal units, the weakest level since August 20.

The front-month December contract ended 1.9% lower on Friday to settle at USD3.513 per million British thermal units.

Nymex gas futures were likely to find support at USD3.386 per million British thermal units, the low from August 18 and resistance at USD3.569, the high from November 1.

Weather-forecasting models continued to point to mild temperatures across most parts of Midwest and Eastern U.S. over the next six-to-ten days.

Bearish speculators are betting on the warm weather reducing early-winter demand for the heating fuel. The heating season from November through March is the peak demand period for U.S. gas consumption.

Meanwhile, U.S. supply levels also remained in focus. The U.S. Energy Information Administration said on Thursday that natural gas storage in the U.S. rose by 38 billion cubic feet.

Inventories rose by 66 billion cubic feet in the same week a year earlier, while the five-year average change for the week is a build of 57 billion cubic feet.

Total U.S. natural gas storage stood at 3.779 trillion cubic feet as last week, 3.1% below last year's unusually high level but 1.6% above the five-year average for this time of year.

Early injection estimates for this week’s storage data range from 33 billion cubic feet to 45 billion cubic feet, compared to a 27 billion cubic feet increase during the same week a year earlier.

The five-year average for the week is a build of 36 billion cubic feet.

Elsewhere on the NYMEX, light sweet crude oil futures for delivery in December fell 0.1% to trade at USD94.53 a barrel, while heating oil for December delivery dipped 0.55% to trade at USD2.866 per gallon. - Investing.com