U.S. natgas futures near flat early, near-term cold supports
NEW YORK, March 1 (Reuters) - U.S. natural gas futures were trading near unchanged early on Friday, underpinned by chilly weather though near-record high supplies and the moderating extended outlook were limiting the upside. Cold forecasts have helped drive the front contract up more than 10 percent over the last two weeks. Traders also viewed Thursday's above-average weekly inventory decline as supportive for prices, noting it was the second straight week that the draw came in above expectations. Most expect another strong pull in next week's report. But despite some near-term cold, traders noted the extended outlook seemed to be moderating and few expect much upside in prices with winter winding down, storage still high and production flowing at or near a record peak. Prices should, however, draw some support from utilities switching from coal to cheaper gas to generate power and from healthy nuclear plant outages that have prompted more gas burn. Gas-fired units are typically used to offset any shut nuclear generation. At 9:20 a.m. EST (1420 GMT), front-month gas futures on the New York Mercantile Exchange were down 0.7 cent at $3.479 per million British thermal units, after trading in a narrow range between $3.456 and $3.503. While the recent run-up in prices broke some key moving average and trendline resistance points and turned the chart picture more supportive, technical traders said Wednesday's weak front-month close after climbing intraday to a five-week high of $3.554 cast doubt about further upside. Most chart watchers would need a close at least above this year's high of $3.645 to turn more positive on prices. MDA Weather Services noted that the six- to 10-day outlook turned slightly warmer again from the central to eastern United States, but the private forecaster still expects another shot of cold air to hit the Midwest in the 11- to 15-day time frame.
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