Natural gas dips on forecasts for mild spring weath

Natural gas futures edged lower in Friday trading after updated weather-forecasting models called for mild temperatures to hover over much of the country in the coming week.

On the New York Mercantile Exchange, natural gas futures for delivery in May traded at $4.639 per million British thermal units during U.S. trading, down 0.34%. The commodity hit session high of $4.673 and a low of $4.608.

The May contract settled up 1.50% on Thursday to end at $4.655 per million British thermal units.

Natural gas futures were likely to find support at $4.222 per million British thermal units, the low from April 2, and resistance at $4.702, Thursday's high.

While a weak cool front pushes through the northern U.S., most of country will see mild temperatures that should cut into the need for heating, though cooler temperatures could return later next week for parts of the central and eastern U.S., Natgasweather.com reported, which cushioned losses.

Profit taking also sent prices edging lower, as investors locked in gains from Thursday's rather bullish supply report and sold the commodity for profits.

The U.S. Energy Information Administration said in its weekly report that natural gas storage in the U.S. in the week ended April 4 rose by 4 billion cubic feet after a drop of 74 billion cubic feet in the previous week.

Analysts had expected a build of 13 billion cubic feet, and the lower-than-expected figure sparked a rally.

Total U.S. natural gas storage stood at 826 billion cubic feet, the lowest for this time of year since 2003.

Severely cold weather over this past winter saw natural gas stockpiles fall to 11-year lows, sparking concerns that producers may not be able to refill inventories before the next heating season. Producers typically replenish inventories between April and October, when demand is lower.

The heating season from November through March is the peak demand period for U.S. gas consumption. Approximately 52% of U.S. households use natural gas for heating, according to the Energy Department.

Spring and fall see the weakest demand for natural gas in the U.S, as the absence of extreme temperatures curbs demand for heating and air conditioning.

Elsewhere on the NYMEX, light sweet crude oil futures for delivery in May were up 0.67% and trading at $104.09 a barrel, while Hheating oil for May delivery were up 0.28% and trading at $2.9474 per gallon.