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It's been an extremely choppy day for natural gas futures.
By mid-afternoon in New York, natural gas futures for March were down 6% at $4.724 per million British thermal units, after reaching as high as $5.442 earlier in the session, the highest level seen in close to four years.
We have seen some extreme weather conditions in the States this winter, which has helped push natural gas futures 17% higher on the month so far, but sharp changes in the weather are contributing to volatile price movements.
While temperatures remain below average today for much of the central US, with the National Weather Service warning of ‘another round of bitterly cold weather’, milder temperatures are being forecast for much of the US East coast next week, a turnaround after the recent frigid temperatures. Accuweather’s 6-10 day outlook shows temperatures being above normal from Florida as far north as North Carolina next week.
Around half of US households use natural gas for heating, according to the US Energy Department. The Energy Department raised its forecast for US natural gas production in 2014 earlier this month.