U.S. natgas futures edge lower ahead of weekly EIA storage data10 minutes ago by Thomson Reuters
* Front month still below recent 21-month high * Weather expected to moderate over the next two weeks * Nuclear power plant outages back above average * Coming Up: EIA gas storage data 10:30 a.m. EDT (1430 GMT By Eileen Houlihan NEW YORK, May 9 (Reuters) - U.S. natural gas futures edgedlower early on Thursday, ahead of expectations for another largeweekly inventory build and amid milder, spring-like temperaturesblanketing most of the nation. Last week's unexpectedly large weekly stock build led to a7-percent selloff on Thursday before prices recovered slightlyon Friday. Prices remain well under last week's 21-month high hit at midweek. A long, cold winter put a huge dent in inventories andlingering cool weather this spring led to a slow start to theinjection season. But the onset of milder spring weather starting this weekhas curbed late-season heating demand before heavy cooling loadskick in. Most traders and analysts expect weekly data from the U.S.Energy Information Administration to show a build of about 83billion cubic feet when it is released at 10:30 a.m. EDT (1430GMT), a Reuters poll showed. Stocks rose 30 bcf during the same week last year and onaverage over the past five years have gained 69 bcf that week. As of 9:22 a.m. EDT (1322 GMT), front-month June natural gasfutures on the New York Mercantile Exchange were at$3.956 per million British thermal units, down 2.2 cents. The contract hit a one-month low of $3.895 on Wednesday,well below the recent 21-month high of $4.444. The latest National Weather Service eight to 14-day forecastissued on Wednesday again called for above-normal temperaturesfor about the western half of the nation and below-normalreadings in the Southeast and most of Texas. Near-normaltemperatures were expected for the Midwest and mid-Atlantic andmuch of the Northeast. Nuclear plant outages totaled 20,900 megawatts, or 21percent of U.S. capacity, up from 18,800 MW out on Wednesday anda five-year average outage rate of 20,200 MW, but down from21,400 MW out a year ago. LARGER-THAN-EXPECTED BUILD BUT STOCKS BELOW NORMAL Last week's EIA gas storage report showed domesticinventories rose in the prior week by 43 bcf, above Reuters pollestimates for a 28 bcf build and the year-ago gain of 31 bcf. But inventories started the injection season about threeweeks later than expected due to the cold spring. Stocks, at1.777 trillion cubic feet, are nearly 31 percent below last yearand more than 6 percent below the five-year average. Baker Hughes data last week showed the number ofrigs drilling for natural gas in the United States fell by 12 toan 18-year low of 353. EIA earlier this week raised its estimate for domesticnatural gas production in 2013, expecting output this year to beup about 1 percent from 2012's levels. If realized, it would bethe third straight year of record production.