FX.co ★ Natural Gas Pulls Back from 1-Month High

U.S. natural gas futures declined to $3.65 per MMBtu on Monday, retreating from the session's earlier peak of $3.78, a one-month high. This downturn was attributed to robust supply levels that balanced out anticipated increases in demand for cooling. According to the latest data from the Energy Information Administration (EIA), underground inventories for domestic utilities increased by 104 billion cubic feet (Bcf) in the week ending May 2nd, markedly exceeding the five-year average of 79 Bcf. This surplus was due in part to mild weather reducing the need for air conditioning. Nevertheless, major forecasters are predicting a hotter summer in North America, suggesting a rise in demand for gas-powered air conditioning in both households and businesses, thus contributing to the ongoing market rebound since the beginning of the month. Additionally, energy commodities received a boost after the U.S. government, under the White House's directive, reduced tariffs on Chinese imports for the next three months, thereby alleviating concerns over an extended trade conflict.