United States Natural Gas Fund (NYSEArca: UNG) dropped 3.5% Wednesday to fall below the 200-day simple moving average for the first time since September. Relatively warm winter temperatures and lingering supply glut worries are pressuring the commodity’s price.
UNG, the natural gas ETF, was down 26.9% over 2012.
Natural gas plunged as much as 9% after the Commodity Weather Group projected that the colder-than-average weather will turn to above-normal temperatures from Jan. 7 through Jan. 11, reports Christine Buurma for Bloomberg.
Natural gas futures was down 3.3% to $3.2 per British thermal unit in late afternoon trading Wednesday.
“We’re going to see some warm weather across the primary gas-consuming regions,” Gene McGillian, an analyst and broker at Tradition Energy, said in the article. “As we get into the new year without signs of sustained cold weather, the fundamental picture is going to force us lower.”
According to the National Oceanic and Atmospheric Administration, 2012 was probably the warmest year on record in the U.S..