Natural gas futures fell 1.8 cents to $2.21 per 1,000 cubic feet after dropping 5 cents on Monday. That's a 10-year low and half of what natural gas was fetching back in July. Oversupply and mild winter weather have contributed to the plunge.
Any money that consumers are saving on natural gas may be going into the gasoline tank. The national average for regular gasoline in the U.S. is $3.90 per gallon, according to AAA, Wright Express and Oil Price Information Service. Since Jan. 31, the national average for gas has either risen or been unchanged on 53 of 56 days. It's risen 17 cents so far in March.
For now, consumer concerns about high pump prices are being offset by good news in the stock market, according to the latest survey of consumer confidence by the private research group Conference Board.
Meanwhile oil prices rose slightly. Benchmark U.S. crude oil gained 30 cents to $107.33 per barrel. In London, Brent crude for May delivery fell 45 cents to $125.20 per barrel on the ICE Futures exchange.
Oil prices remain high because of ongoing tension over Iran's nuclear program. Oil has jumped from $75 a barrel in October because of concern that a military strike by Israel or the U.S. against Iran's nuclear facilities would disrupt global crude supplies.
Natural gas supplies are currently more than 50 percent above the five-year average for this time of year. That's due to a boom in production in Pennsylvania, Ohio, Texas and others states. And homeowners used less natural gas for heating this winter than in years past because of warmer than normal temperatures.
Shiyang Wang, an analyst at Barclays Bank PLC, said in a research report that the market has turned its attention to whether the surplus gas in storage could be absorbed by hot summer weather and utilities opting to use cheap gas for power generation instead of coal. If storage is still abundant as summer ends, prices could remain low in October and November, the analyst said.
In other energy trading, heating oil fell 1 cent to $3.22 per gallon and gasoline futures dropped 1.1 cents to $3.41 per gallon.
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