US natgas hits $3, but falls

Natgas futures: Nearly hit milestone, but fall

Scanpix/AFP

By News wires

 06 July 2012 22:18 GMT

US natural gas futures fell nearly 6% on Friday after briefly hitting $3 for the first time since January as pressure from a forecast for cooler weather and reduced power demand outweighed a bullish government storage report.

The pull-back threatens to cap a nearly four-week rally that pushed prices up by more than a third, reaching a point at which analysts say gas is losing its price appeal over coal as a power-generation fuel, Reuters reported.

August futures on the New York Mercantile Exchange settled down nearly $0.17, or 5.7%, at $2.776 after earlier hitting $3.060, the highest level since early January. Gas for September to November showed similar declines.

Since posting a 10-year low of $1.902 twice in late April, nearby futures are up about 55% on signs that…

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