Natural gas prices rise despite US inventory buildup

Natural gas futures tilted higher in American trade even as the dollar rebounded for the second session from a seven-month low, while the EIA report showed the largest US inventory buildup since September 2015. 

As of 07:50 GMT, natural gas futures due on July 16 rose 0.36% to $3.031 per million British thermal units from the opening of $3.019, with an intraday high at $3.068, and a low at $2.978, while the dollar index rose 0.24% to 96.98 from the opening of 96.75. 

The Energy Information Administration released its report on US natural gas stocks, showing a buildup of 106 billion cubic feet in the week ending June 2, adding to an 81B rise in the previous reading, and above expectations of 99 billion. 

Total stocks have reached 2.631 trillion cubic feet, up from 2.525 trillion in the week ending May 26, which is below the total of the same period last year at 2.963 trillion, while above the five-year average of 2.394 trillion. 

US unemployment claims rose past expectations, as caution grips the markets after Four Arab countries, led by Saudi Arabia, cut their ties with Qatar and severed all air, land, and sea connections with Doha earlier this week on account of their alleged support for militant groups and Iran.

Qatar is the world's largest natural gas exporter, while these political tensions bolster prices and threaten supply. 

Other countries such as Libya, Yemen, Mauritania, and Comoros joined in the boycott, while Jordan downgraded its diplomatic representation with Qatar, and France called on Doha to cooperate with neighbors and answer their questions