By Reg Curren
Feb. 4 (Bloomberg) -- Natural gas futures advanced in New York on speculation a government report tomorrow will show the biggest weekly drop in supplies thus far in the heating season.
Stockpiles may have dropped 200 billion cubic feet last week, according to the median of five analyst estimates compiled by Bloomberg. The five-year average decline for the week is 183 billion cubic feet, according to Energy Department data.
“In the short term, there’s a bullish withdrawal expected tomorrow,” Michael Rose, a director of trading at Angus Jackson Inc. in Fort Lauderdale, Florida. “And you have to start taking into consideration that production has been cut.”
Natural gas for March delivery rose 6.1 cents, or 1.4 percent, to $4.574 per million British thermal units at 9:36 a.m. on the New York Mercantile Exchange. Gas has dropped 19 percent this year and is down 67 percent from the 2008 high of $13.694 reached July 2.
Cuts in gas exploration and production will begin to show up in supplies later this year, when the U.S. economy may start to recover, Rose said.
The prices for gas also appears to be at a bottom and at this level makes it attractive to large consumers to make purchases now to lock in prices in the future, he said.
To contact the reporter on this story: Reg Curren in Calgary at rcurren@bloomberg.net.
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