Natural Gas Falls on Storm Outlook

Natural gas futures were trading in the red after the release of a bearish inventory report and the forecast of a milder hurricane season this year.

Author:
Andrea Tse
Publish date:
May 19, 2011 1:09 PM EDT

Natural gas futures were trading in the red after the release of a bearish inventory report and the forecast of a milder hurricane season this year.

NEW YORK (TheStreet) -- Natural gas futures were trading in the red after the release of a bearish inventory report and the forecast of a milder hurricane season this year.

Natural gas for June delivery was behind by 1.4% to $4.138 per million British thermal units. Earlier prices hit a one-month low of $4.091.

"This is very much a sideways market heading into hurricane season," Gelber & Associates said in a report. "

The National Oceanic and Atmospheric Administration announced their broad expectation ranges today... in line with the privates' outlooks."

The National Oceanic and Atmospheric Administration's hurricane report forecasted 12 to 18 named storms during the 2011 Atlantic hurricane season and six to 10 storms that could become hurricanes -- this would be above-average storm activity, but still milder than 2010's unusually active season.

The six-month storm season begins on Jun. 1.**

The markets were focusing on the report in order to gain better insight into how weather could impact natural gas demand and production.**

Earlier today, the U.S. Energy Information Administration reported that natural gas inventories increased by 92 billion cubic feet (Bcf) in the week ended May 13 to 1,919 Bcf -- more than what the markets were expecting.

The consensus view of analysts surveyed by Platts was an increase of natural gas stocks by 87 Bcf to 91 Bcf.

Natural gas stocks were trading mixed. **

Kinder Morgan Energy Partners

(KMP)

was rising 0.9% to $72.98,

(BP) - Get Free Report

was adding 1.6% to $43.95,

Devon Energy

(DVN) - Get Free Report

was falling 0.7% at $82.47,

Newfield Exploration

(NFX)