Natural gas futures jumped up in afternoon trading on Thursday after investors viewed the commodity, which dropped on the release of official supply data earlier, as oversold.
On the New York Mercantile Exchange, natural gas futures for delivery in May traded at USD3.942 per million British thermal units, up 1.09%.
The commodity hit a session low of USD3.862 and a high of USD3.966.
The U.S. Energy Information Administration said in its weekly report released earlier that natural gas storage in the U.S. in the week ended March 29 fell by 94 billion cubic feet, slightly above expectations for a drop of 91 billion cubic feet.
Inventories increased by 43 billion cubic feet in the same week a year earlier, while the five-year average change for the week is a build of 4 billion cubic feet.
Total U.S. natural gas storage stood at 1.687 trillion cubic feet as of last week. Stocks were 779 billion cubic feet less than last year at this time and 37 billion cubic feet below the five-year average of 1.724 trillion cubic feet for this time of year.
The report showed that in the East Region, stocks were 76 billion cubic feet below the five-year average, following net withdrawals of 48 billion cubic feet.
Stocks in the Producing Region were 29 billion cubic feet below the five-year average of 724 billion cubic feet after a net withdrawal of 42 billion cubic feet.
Gas prices fell initially on release of the data, though investors later concluded the numbers were close enough to market forecasts to merit bottom fishing.
Forecasts for warmer temperatures in the U.S. have pushed natural gas prices down, as the need for heating diminishes with the arrival of springtime weather patterns.
As late spring and early summer approach, however, rising temperatures hike demand for natural gas as more and more homes and businesses crank up their air-conditioning units to keep cool.