Nat-Gas Prices Plummet as Cooler Forecasts Offset Elevated Inventories

Natural gas prices declined on Friday as US inventories remain above their five-year average and weather forecasts turned slightly cooler.

The August Nymex natural gas contract (NGQ26) closed down -0.045 (-1.54%) to its lowest level in over two months, falling back towards last week's nearest-futures low of 2.25 dollars per million BTU.

Barchart analyst Rich Asplund noted that the Commodity Weather Group still predicts above-average temperatures in the interior West through August 7, but at a lower temperature than previously forecasted.

The potential for a powerful El Niño weather system to bring warmer-than-normal temperatures to the Northern Hemisphere this fall and winter also weighed on natural gas prices, as it could reduce heating demand.