NEW YORK (AP) — The price of natural gas dropped more than 3 percent Thursday following reports of an unexpectedly large increase in U.S. supplies.
The U.S. Energy Department said that natural gas, which is burned for heat in the winter and electricity in the summer, grew in supply by 57 billion cubic feet last week. That's more than the 51 billion to 55 billion cubic feet that analysts were predicting. Prices tend to fall as supplies go up.
Natural gas futures fell by 9.3 cents, or 3.3 percent, to $2.705 per 1,000 cubic feet in New York. The price had risen about 24 cents in the past four sessions and about 88 cents, or 45.5 percent, since April, when natural gas hit a 10-year low.
The U.S. has been slowly burning off an abnormally large surplus of natural gas this year. Stockpiles had jumped following a boom in North American production and a relatively warm winter. Supplies are still growing, though rising temperatures from the Midwest to the East Coast have recently kept those supply increases relatively moderate.
America's natural gas supply is about 25 percent higher than average for this time of year, the government said.
Meanwhile, the Supreme Court's decision to uphold the central provision of President Obama's health care overhaul is indirectly affecting the price of oil. U.S. stock markets declined sharply after the ruling and oil followed.
Benchmark U.S. crude lost $1.80, or 2.2 percent, to $78.41 per barrel in New York while Brent crude fell by $1.40 to $92.10 per barrel in London.
Bank stocks led the drop on Wall Street on reports of bigger-than-expected losses at JPMorgan. Hospital stocks rose while insurance stocks fell after the Supreme Court upheld the requirement that almost all Americans carry health insurance.
Retail U.S. gasoline prices fell by 1.4 cents to a national average of $3.369 per gallon, according to auto club AAA, Wright Express and Oil Price Information Service. A gallon of regular unleaded has dropped by 56.7 cents since prices peaked in the first week of April.
In other futures trading, heating oil lost 3.4 cents to $2.5597 per gallon while wholesale gasoline lost 2.11 cents to $2.5993 per gallon.