Investing.com - Natural gas futures held steady at a five-week high on Wednesday, as investors monitored tropical storm activity in the Gulf of Mexico, amid concerns over a disruption to supplies from the region. Market participants also focused on near-term weather forecasts to gauge the strength of demand for the fuel. On the New York Mercantile Exchange, natural gas futures for delivery in October traded at USD3.672 per million British thermal units during U.S. morning trade, up 0.15%. Prices traded in a range between USD3.665 per million British thermal units, the dilly low and a session high of USD3.687, the strongest level since July 25. The October contract settled 2.4% higher at USD3.666 on Tuesday. The U.S. National Hurricane Center said Tuesday that two low-pressure storm systems near the Gulf of Mexico each have a 20% chance of becoming a tropical cyclone. Energy traders track tropical storm activity in the event it disrupts production in the Gulf of Mexico, which is home to 10% of U.S. natural gas production. Prices found additional support after updated weather forecasting models pointed to warmer-than-normal temperatures across most parts of the U.S. Midwest through mid-September, boosting near-term demand expectations. Demand for natural gas tends to fluctuate in the summer based on hot weather and air conditioning use. Meanwhile, U.S. supply levels also remained in focus. Total U.S. natural gas storage stood at 3.130 trillion cubic feet as of last week, 1.5% above the five-year average but still 7% below last year's level. Early injection estimates for Thursday’s storage data range from 45 billion cubic feet to 53 billion cubic feet, compared to a 33 billion cubic feet increase during the same week a year earlier. The five-year average for the week is a build of 60 billion cubic feet. Elsewhere on the NYMEX, light sweet crude oil futures for delivery in October shed 0.65% to trade at USD107.84 a barrel, while heating oil for October delivery dipped 0.5% to trade at USD3.133 per gallon.

Source