With path predictions surrounding Hurricane Wilma currently looking more and more as if the storm will spare the producing areas of the Gulf of Mexico, energy traders sighed in relief Tuesday. Gapping lower by over 50 cents following the overnight Access trading session, November natural gas on Tuesday ended up settling at $13.421, down 46.6 cents on the day.

The prompt month on Tuesday stayed within a relatively tight 26-cent trading range between $13.36 and $13.62. The day’s action was a reversal from Monday’s market move, when prompt month futures shot up 66.8 cents on fears surrounding Wilma’s potential path into the Gulf of Mexico. While that path has not been ruled out, some forecasters — including the National Hurricane Center — believe that the 12th hurricane of the season is headed for Florida and the East Coast.

A Washington, DC-based broker said that because the natural gas futures market is hanging on the storm’s path changes, the hurricane’s impact on the futures market could be the basis for a new soap opera entitled As Wilma Wobbles.

“People are saying once Wilma gets up to the mouth of the Gulf, it is going to depend on which way the wind’s blowing,” he said. “It’s not there yet, so if you can tell me where the wind is going to be in five days, then you have more skills than I do. It is still too soon. Who knows what it is going to do. I think we are going to have this type of market with swings on forecasts over the course of this week unless Wilma completely deteriorates. We can probably look forward to more of this bouncing around 40-50 cents a day.”

The broker noted that the recent trading range appears to be $12.70 to $14.75. “If we break that $12.70 level, I would predict November could move down to $10.65, based on technicals. Coincidentally, that $10.65 level is the top of that gap before the big move up in late August, basis the perpetual chart,” he said. “However, despite Tuesday’s move, we still think the short-term momentum is still on balance shifting up. I think it is more likely that we will test $14.75 than it is that we will break $12.70.”

The National Hurricane Center said Tuesday afternoon that Wilma was a Category One hurricane with sustained winds of 80 mph. The storm was approximately 180 miles south of Grand Cayman. The National Hurricane Center projects Wilma’s path as forming a broad arc to the north and northeast, grazing the western tip of Cuba and hitting the southern tip of Florida early Sunday.

Changing its tune from other path projections earlier in the week, AccuWeather.com on Tuesday said it expects Wilma to become a serious threat to Florida this weekend.

“The storm will reach Category Three strength by the end of Wednesday and could become a Category Four hurricane for awhile on Thursday or Friday,” said AccuWeather.com senior meteorologist John Kocet. “Deviations in the path are still possible, but currently we feel southern and central Florida will experience the full fury of the storm. When the storm makes landfall this weekend, the west coast of Florida somewhere between Tampa and the Keys could be pounded by winds over 100 mph and a destructive storm surge. Torrential rain brought by the storm will be widespread across a large portion of the state.”

Other energies were also sitting a little lighter Tuesday afternoon. November crude closed $1.16 lower at $63.20/bbl, while November unleaded gasoline and November heating oil dropped 8.01 cents and 4.91 cents, respectively, to settle at $1.7352/gallon and $1.9342/gallon.

©Copyright 2005Intelligence Press Inc. All rights reserved. The preceding news reportmay not be republished or redistributed, in whole or in part, in anyform, without prior written consent of Intelligence Press, Inc.