Natural gas futures shot up on Thursday after weekly U.S. inventory data revealed heavier demand for the commodity thanks to a recent cool snap than markets were expecting.
On the New York Mercantile Exchange, natural gas futures for delivery in May traded at $4.669 per million British thermal units during U.S. trading, up 1.80%. The commodity hit session high of $4.702 and a low of $4.525.
The May contract settled up 1.15% on Wednesday to end at $4.5864 per million British thermal units.
Natural gas futures were likely to find support at $4.22 per million British thermal units, the low from April 2, and resistance at $4.732, the high from March 10.
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 down 0.27% and trading at $103.32 a barrel, while heating oil for May delivery were down 0.55% and trading at $2.9378 per gallon.