Natural gas sinks 6% to eight-week low after US inventory data

Natural gas futures tumbled six percent in American trade to November 2 lows, on track for the third weekly loss in four, while the dollar index plumbed December 20 lows. 

That comes after a slew of US data, including the EIA report that showed a reduced inventory drawdown last week. 

As of 07:53 GMT, natural gas futures due in January tumbled 5.79% to $3.30 per million British thermal units, plumbing eight-week lows, while the dollar index slipped 0.10% to 96.39, hitting week lows. 

US Inventory Data 

The Energy Information Administration reported a drawdown of 48 billion cubic feet in US natural gas stocks in the week ending December 21, compared to a 141 billion drop in the previous reading, while slightly below estimates of 50 billion. 

Total stocks are down to 2.725 trillion cubic feet from 2.773 trillion in the week ending December 14, making them below the total of the same period in 2017 at 3.348 trillion, while also below the five-year average at 3.372 trillion. 

Other US data showed the Chicago PMI receded to 65.4 from 66.4 in November, still edging estimates of 61.4. 

US pending home sales fell 0.7% m/m in November, improving on a 2.6% monthly drop in October, while still missing expectations of a 1% increase, as sales fell 7.7% y/y, sharpening a 4.7% yearly drop in October.