U.S. natgas futures drop 5 percent on short-term mild weather
NEW YORK, Jan 30 (Reuters) - U.S. natural gas futures for March lost 5 percent early Thursday on forecasts for a few days of mild winter weather after prices rocketed over 10 percent late Wednesday due to short-covering before the February contract expired.
MDA Weather Services on Thursday forecast the weather would turn relatively "warm" over the next five days in the South and East, before intense cold returns to the Central and Great Lakes regions over the next six- to 10-days.
The front-month futures on the New York Mercantile Exchange have gained or lost at least 5 percent every day since Jan. 23, and managed to jump over 10 percent higher on two of those days.
"All this volatility spells opportunity for all. Buyers, sellers, producers, end-users, marketers ... it's a smorgasbord of hedging and trading just there for the taking," Jay Levine of enerjay LLC in Portland, Maine, said in a morning note.
At 8:40 a.m. EST (1340 GMT), the March contract was trading at $5.230 per million British thermal units, down 4.3 percent, or 23.5 cents.
On Wednesday, the front-month contract, which was the February contract, reached a high of $5.725 per mmBtu, the highest level since January 2010, before ending the day up over 10 percent.
Even with the losses early this morning, the front-month is up about 23 percent since the beginning of January.
