NEW YORK: US natural gas futures fell about 4% to an 18-month low on Friday on rising output and forecasts for heating demand to remain low and the weather to stay warmer-than-normal for another week, allowing utilities to leave more gas in storage.
Front-month gas futures for February delivery on the New York Mercantile Exchange fell 13.9 cents, or 3.8%, to $3.556 per million British thermal units at 12:08 p.m. EST (1708 GMT), putting the contract on track for its lowest close since June 25, 2021.
That kept the front-month in technically oversold territory with a relative strength index (RSI) below 30 for a fourth day in a row and an 11th time in the last 12 days.
For the week, the contract was down about 4%, putting it down for a fourth week in a row for the first time since October. During the prior three weeks, the contract lost 44%.
The premium on March futures over April, which the industry calls the widow maker, slid to a record low of 4 cents per mmBtu as some market participants give up hope that extreme cold will bring a price spike later this winter.
The industry uses the March-April spread to bet on the winter heating season when demand for gas peaks.
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