U.S. natural gas futures on Tuesday traded within a few cents of unchanged on forecasts for steady warmer-than-normal weather and light heating demand over the next two weeks. Analysts, however, noted the market has gained about 25 percent from an eight-month low of $2.522 in February as traders focus on the potential for low inventory levels going into next winter due to projections for lackluster production and rising exports.
U.S. and European weather models projected temperatures would hold above normal over the next two weeks. As the weather warms, gas consumption was expected to slip to 75.9 billion cubic feet per day (bcfd) this week to 74.2 bcfd next week from 76.4 bcfd last week, Thomson Reuters data showed. Meteorologists forecast temperatures this summer would be above normal, sparking expectations of higher-than-average power generator gas consumption to meet stronger air conditioning demand.