June 18, 2013 / 1:48 PM / 4 years ago

U.S. natgas futures edge higher, heat backs more gains

* Front month well above recent 3-month spot chart low
    * Nuclear power plant outages remain above normal
    * Tropical depression to move over Bay of Campeche
    * Coming up: EIA natgas storage data on Thursday

    By Eileen Houlihan
    NEW YORK, June 18 (Reuters) - U.S. natural gas futures edged
higher early on Tuesday, extending Monday's nearly 4 percent
gain, as forecasts for hotter weather across consuming regions,
above-normal nuclear plant outages and a stir in tropical
activity lent support.
    The National Weather Service's six- to 10-day forecast
issued on Monday called for above-normal temperatures for most
of the country, with normal readings only along the Gulf Coast
and in Florida and Texas.
    Private forecaster MDA Weather Services also called for
above-normal readings everywhere but the Southeast in its six-
to 10-day outlook issued on Tuesday.
    The U.S. National Hurricane Center said Tropical Depression
Two was expected to move over the Bay of Campeche, home to key
Mexican oil operations, by late Wednesday. 
    Gas traders do not expect the system to disrupt much Gulf of
Mexico gas production but said it serves as a reminder that the
2013 hurricane season is in full swing.
    As of 9:28 a.m. EDT (1328 GMT), front-month July natural gas
futures on the New York Mercantile Exchange were at
$3.897 per million British thermal units, up 2.2 cents, after
trading between $3.873 and $3.932.
    The contract hit a three-month low of $3.71 last week, after
rising to a 21-month high of $4.444 on May 1.
    In the news on Tuesday, an explosion at a gas line or gas
plant about 80 miles (128 km) north of New Orleans in the town
of Enon, Louisiana, knocked out power to about 10,000 customers,
according to local reports. Local media said the line was owned
by Florida Gas, but the company was not immediately available
with further details. 
    Nuclear plant outages totaled 8,200 megawatts, or 8 percent
of U.S. capacity, down from 8,500 MW out on Monday and 9,100 MW
out a year ago, but up from a five-year average outage rate of
6,600 MW. 
    Last week's gas storage report from the U.S. Energy
Information Administration showed domestic gas inventories rose
the prior week by 95 billion cubic feet to 2.347 trillion cubic
feet. 
    (Storage graphic: link.reuters.com/mup44s)
    Early injection estimates for Thursday's EIA report range
from 85 bcf to 95 bcf, versus a 63-bcf build in the same week
last year and a five-year average rise for that week of 80 bcf.
    

 (Editing by Dale Hudson)

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