Natural gas futures rose on Tuesday as investors bet a heat wave making its way across the eastern U.S. will prompt households to ramp up their air conditioning.
On the New York Mercantile Exchange, natural gas futures for delivery in September traded at $4.002 per million British thermal units during U.S. trading, up 0.92%. The commodity hit a session low of $3.960, and a high of $4.020.
The September contract settled up 0.08% on Monday to end at $3.965 per million British thermal units.
Natural gas futures were likely to find support at $3.858 per million British thermal units, last Thursday's low, and resistance at $4.012, Monday's high.
While showers and thunderstorms may cool off parts of the U.S. this week, a heat wave will hold its ground through the third week in August.
"Weather systems over the northern U.S. early in the outlook will lead to cooler than normal temperatures over many regions. However, high pressure will strengthen after August 20th and bring a nice warm up to much of the U.S.," Natgasweather.com said in its Aug. 19-25 outlook earlier Tuesday.
"The southern U.S., including Texas, will remain very warm to hot throughout with highs reaching the 90s and 100s."
Higher temperatures often fuel demand for more natural gas as households and business ramp up their air conditioners.
Supply data remain in focus as well.
The U.S. Energy Information Administration said in its weekly report on Aug. 7 that natural gas storage in the U.S. rose by 82 billion cubic feet during the week before.
The number was below expectations for an increase of 84 billion cubic feet, but higher than the five-year average change for the week of an increase of 49 billion cubic feet.
Injections of gas into storage have surpassed the five-year average for 16 consecutive weeks, alleviating concerns over tightening supplies.
Total U.S. natural gas storage stood at 2.389 trillion cubic feet as of last week, narrowing the deficit to the five-year average to 20% from 21.7% a week earlier and down from a record 54.7% at the end of March.
The EIA's next storage report is slated for release on Thursday, Aug. 14, with analysts expecting a build of 85 billion cubic feet for the week ending August 8.
Inventories rose by 70 billion cubic feet in the same week a year earlier, while the five-year average change is a build of 45 billion cubic feet.
Elsewhere on the NYMEX, light sweet crude oil futures for delivery in September were down 0.75% at $97.34 a barrel, while heating oil for September delivery were down 0.96% at $2.8517 per gallon.