Natural gas forward market prices are signaling a continuation of low natural gas prices through 2012, the Energy Information Administration (EIA) said in an analysis released Thursday.

Winter 2011-2012 forward prices were recently the lowest in more than 10 years, and of the eight trading points identified, only Transco Zone 6-NY (New York City) and PG&E Citygate (Northern California) showed 2012 forward monthly price ranges that include prices above $4/MMBtu, the agency said.

Forward prices at the Henry Hub, TCO-Appalachia, Houston Ship Channel, El Paso Permian, Northwest Pipeline Rockies and SoCal Citygate were below $4/MMBtu.

Natural gas spot prices remained low throughout 2011 relative to prior years, reaching a two-year low in November, the EIA said. The spot natural gas price at Transco Zone 6-NY is above 2012’s average monthly trading ranges due to recent weather-driven demand. Current spot gas prices are lower than the 2012 forward contract range at several natural gas trading points.

Natural gas prices at the Henry Hub in Louisiana set the prices for much of the rest of the country, with the exception of spot and forward prices during colder weather in the Northeast (at Transco Zone 6-NY), the EIA said. Northeast spot and forward prices rise during colder months due to expectations regarding pipeline constraints in transporting gas to the Northeast during times of high natural gas demand.

Front-month futures trading isn’t helping any talks of a rebound either. On Dec. 30 the February futures contract closed below $3 for the first time in more than two years (see Daily GPI, Jan. 3). The contract’s settlement at $2.989 marked the first close under $3 since the October 2009 contract settled at $2.960 back on Sept. 11, 2009.

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