24 March 2008 19:57 [Source: ICIS news]
HOUSTON (ICIS news)--US natural gas futures gained 26.4 cents (2.91%) to close at $9.329/m Btu on Monday amid profit-taking by traders and heightened demand.
Monday’s early gains were attributed to buying by traders to cover short positions taken during the steady decline in values from the $10.23/m Btu settlement price set on 13 March.
Buyers also sought to cover demand for winter heating fuels that resulted from colder temperatures in the northeast and midwest US.
Also, demand from the industrial and commercial sectors was restored after closings for the long Easter weekend. These sources were expected to pull winter natural gas heating inventories to levels below the five-year average stock level at the end of the winter season.
The low stock level would increase the need to rebuild inventories during the summer months ahead of the 2008-2009 winter heating season.
During the 2007 summer period, the need for storage was below average and speculators anticipate higher demand in the coming months could push natural gas prices back above the $10/m Btu level.
During the session, natural gas prices peaked at $9.447/m Btu, up 38.2 cents (4.21%) before late-session selling prior to the settlement.
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