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Natural Gas Futures Plunge After Supplies Post Smaller-Than-Expected Drop

February 1, 2018 at 16:03 by Andrew Moran

Natural gas futures are plummeting on the first day of February as a new US government report showed a smaller-than-expected decline in domestic supplies.

March natural gas futures plunged $0.13, or 4.37%, to $2.864 per million British thermal units (btu) at 14:44 GMT on Thursday on the New York Mercantile Exchange. Last month, natural gas prices advanced 2.5%, thanks to the deep freeze impacting many parts of the US.

According to the US Energy Information Administration (EIA), US supplies of natural gas tumbled by 99 billion cubic feet for the week ending January 26. Total natural gas stocks now stand at 2.197 trillion cubic feet, down 526 billion cubic feet from the same time a year ago, and 425 billion below the five-year average.

Meanwhile, February gasoline futures rose $0.002, or 0.11%, to $1.8958 per gallon, while February heating oil futures jumped $0.0225, or 1.09%, to $2.0889 a gallon.

On Wednesday, the EIA reported that US crude supplies increased 6.8 million barrels, while total US oil output surged 41,000 barrels per day (bpd) to 9.91 million bpd.

During the Thursday trading session, March West Texas Intermediate (WTI) crude futures soared $0.92, or 1.42%, to $65.65 a barrel. April Brent crude futures rose $0.62, or 0.90%, to $69.51 a barrel.

The US dollar lifted commodities on Thursday as the greenback shed 0.30%, falling to under 89.0 once again. A weaker Federal Reserve Note is good for dollar-denominated commodities because it makes it cheaper for foreign investors to buy.

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