Supply Data Fuels Natural Gas Surge to Fresh 2013 High
Natural gas futures surged nearly 3 percent on bullish supplies data Thursday to reach an intraday high of $4.335 per million BTUs, the highest price for a front-month contract since July 2011.
The U.S. Energy Department reported natural gas supplies rose by 31 billion cubic feet last week, the first increase in storage so far this year. Still, the supply increase fell short of analysts' expectations and was also lower than the five-year average.
Tim Evans, energy futures specialist at CitiFutures, said that the natural gas supply data "was supportive relative to consensus expectations, suggesting a slower tapering off of heating demand than had been anticipated."
However, Evans said he was skeptical about whether this price surge would last.
"Although the data revives the upside potential for prices in the near term, we still consider the rally as more fragile than it might appear as it is still weather dependent," he added.
During the next 10 days, below normal temperatures are forecast for the central U.S., according to Tradition Energy, while the eastern third of the U.S. is expected to see mostly normal temperatures in the coming weeks.
For the past two weeks, natural gas prices have been above the $4 mark and prices have remained resilient despite this week's broad commodity sell-off. Technically, Tradition Energy sees the next target resistance level at $4.373 per million BTUs.
—By CNBC's Sharon Epperson; Follow her on Twitter @sharon_epperson