Stormy natural gas market in view with uncertain winter weather
Trading in US natural gas is expected to become turbulent in the coming weeks as hedge funds are split on the direction of the fuel's price, due to uncertainty over autumn and winter weather.
Photo courtesy of Reuters.
(Reuters) The funds are divided between the view that US natural gas will exceed $3/MMBtu by the end of the year if the weather turns cold, or that another mild winter will dampen prices again.
Some hedge funds are confident that utilities will continue burning greater-than-normal amounts of gas to power air conditioning in the final weeks of the summer, which has been hotter than forecast.
They also bet that a frigid autumn, which begins on September 22, and winter, starting on December 22, will result in higher-than-usual gas consumption for heating, which would help them burn off the record stockpiles of gas accumulated in storage this year.
Forecasters at AccuWeather said in late June the eastern US, which uses more gas than other fuels for heating, could experience warm weather late into autumn.
(Additional reporting by Vijaykumar Vedala in Bengaluru; editing by Bill Rigby.)
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