With more pressing issues facing traders on Thursday, the Energy Information Administration’s (EIA) natural gas storage report of a 74 Bcf injection for the week ended Sept. 16 came and went with little fanfare. After hitting a high of $13.15 in morning trade on Hurricane Rita fears, October natural gas futures went on to settle at $12.79, or about 19.6 cents higher than Wednesday and a new all-time record high settle for a prompt month.

Following the report’s 10:30 a.m. EDT release, October natural gas futures barely budged from its perch of $13 before trickling lower a few minutes later. The prompt month hit a morning low of $12.85 at 10:36 a.m. before arcing higher. After bouncing on either side of $13 for a majority of the session, the prompt month began to slip lower around 1 p.m.

While the storage report is normally a focal point for traders on Thursdays, the number was only slightly above expectations and clearly overshadowed by Hurricane Rita. On Thursday, Rita was downgraded to a Category Four hurricane and appeared to adopt a new more northerly track. It now appears that Rita will make landfall in between Galveston and the Texas/Louisiana border sometime Saturday morning, according to the National Hurricane Center (see related story).

“Trading also was very slow on Thursday. I think a lot of traders were already bugging out of Houston, not to mention the fact that everybody is locked up,” said Brad Florer, a broker with ICAP Energy. “How do you strategize around a random event, which is exactly what we are facing. They are not sure where Rita is going to land, and they don’t know what it is going to look like when it does. There are too many unknowns.”

Florer said the fear and uncertainty in the market were the reasons natural gas futures didn’t really go anywhere on Thursday. “Sure we had a 50-cent range, but a 50-cent range when you’re trading $13 is nothing,” he said. “I really didn’t see a lot of conviction one way or another. It’s going to be interesting for a while just figuring out what the ramifications are from this whole storm situation. Demand might be the thing people begin watching a little closer because they may be able to quantify it better than they can supply right now.”

As for the storage report, the broker said he believes it was more of a non-event because it came out where many thought it would. “Had it been well above or well below expectations, I think the market would have taken a hard look at it because demand issues are what is keeping this market from becoming a runaway,” Florer said. “I think bulls are very concerned that when this thing all shakes out and demand gets looked at, that it possibly could be significantly off and that could really drive the prices down quickly, especially when all of the emotion dries up from this thing.”

The 74 Bcf storage build was slightly larger than last year’s 72 Bcf injection and a little smaller than the five-year average build of 80 Bcf. The ICAP-Nymex storage options auction on Wednesday revealed a consensus forecast of a 69.18 Bcf injection.

Working gas in storage now stands at 2,832 Bcf, according to EIA estimates. Stocks are now 100 Bcf less than last year at this time and 92 Bcf above the five-year average of 2,740 Bcf. The East region injected 50 Bcf for the week, while the Producing and West regions chipped in 16 Bcf and 8 Bcf, respectively.

If traders are not outright bulls now they are certainly not motivated sellers. “No one is ready to sell this market aggressively, and crude oil has lost its impact. The crude number Wednesday had no impact,” said a New York floor trader. The DOE reported crude oil inventories fell 300,000 barrels, less than analysts’ expectations.

Looking to give its members more flexibility and the ability to better manage their risk, the New York Mercantile Exchange Inc. (Nymex) said Thursday afternoon that it will extend trading hours on Sunday (see related story).

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