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U.S. natgas futures up less than 1 percent

Source: Reuters - Wed, 18 Dec 2013 01:44 PM
Author: Reuters
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NEW YORK, Dec 18 (Reuters) - U.S. natural gas futures were up less than 1 percent early Wednesday as expectations for a big inventory withdrawal this week offset forecasts for warmer weather.

At 8:24 a.m. EST (1325 GMT), front-month January futures on the New York Mercantile Exchange were up 2.2 cents at $4.309 per million British thermal units.

Private forecaster MDA Weather Services, in its one-to-five-day outlook, forecast more warmth would spread East. It expects less cold than previously forecast in its six-to-10-day outlook.

"Even with warmer-than-normal temperatures heading to the East Coast over the weekend, the market is not yet ready to enter into a major sell-off as total natural gas inventories remain below both last year and the five-year average," said Dominick Chirichella, a partner at Energy Management Institute.

"The gap is expected to widen significantly after this week's expected above-normal inventory withdrawal," Chirichella said.

Withdrawal estimates for this week's storage report from the U.S. Energy Information Administration range from 220 billion cubic feet to 284 bcf, compared with a year-ago draw of 70 bcf and a five-year average draw of 133 bcf. The report is due on Thursday.

Last week's gas storage report showed total inventories stood at 3.533 trillion cubic feet, more than 7 percent below the year-earlier level and nearly 3 percent below the five-year average.

In U.S. nuclear news, 5,300 megawatts were out on Wednesday, versus 6,000 MW out on Tuesday. That compares with 12,000 MW out a year ago and a five-year average outage rate of 7,500 MW. (Reporting by Scott DiSavino; Editing by Lisa Von Ahn)

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