Natural gas futures - Weekly outlook: March 18 - 22

                        Natural gas futures ended Friday’s session at a 15-week high, as a bigger-than-expected drop in U.S. supplies and forecasts showing colder weather in the upcoming week boosted near-term demand expectations for the heating fuel.

Natural gas prices have closely tracked shifting weather forecasts in recent weeks, as traders try to gauge the impact of shifting forecasts on late-winter heating demand.

On the New York Mercantile Exchange, natural gas futures for delivery in April jumped 1.25% Friday to settle at USD3.860 per million British thermal units by close of trade.

Earlier in the day, Nymex gas prices rose to a session high of USD3.924 per million British thermal units, the strongest level since November 26.

On the week, natural gas prices rallied 6.1%, the fourth consecutive weekly advance.

Natural gas prices have risen sharply in recent weeks. The heating fuel has surged nearly 19% since falling close to a four-month low of USD3.125 per million British thermal units on February 15, boosted by calls for colder temperatures in major consuming regions across the U.S.

Sentiment on the heating fuel remained upbeat after updated weather forecasts continued to call for below-normal readings for most of the Eastern half of the U.S. in the next six-to-ten days.

Bullish speculators are betting on the cool weather increasing late-winter demand for the heating fuel.

The heating season from November through March is the peak demand period for U.S. gas consumption. Nearly 50% of all U.S. households use gas for heating.

Meanwhile, Thursday's larger-than-expected drawdown from winter inventories also kept momentum to the upside.

The U.S. Energy Information Administration said that natural gas storage in the U.S. in the week ended March 8 fell by 145 billion cubic feet, compared to expectations for a drop of 134 billion cubic feet.

Inventories fell by 66 billion cubic feet in the same week a year earlier, while the five-year average change for the week is a decline of 74 billion cubic feet.

Total U.S. natural gas storage stood at 1.938 trillion cubic feet as of last week, 18.5% below their level this time last year, but still 11.4% above the five-year average.

Early withdrawal estimates for this week’s storage data range from 48 billion cubic feet to 73 billion cubic feet.

Inventories withdrawals were flat in the same week a year earlier, while the five-year average change for the week is a decline of 26 billion cubic feet.

Elsewhere in the energy complex, light sweet crude oil futures for April delivery settled at USD93.58 a barrel by close of trade on Friday, adding 1.85% on the week.

Meanwhile, heating oil for April delivery shed 0.85% over the week to settle at USD2.947 per gallon by close of trade Friday. Courtesy : Investing.com