Advances

Getting significant boosts from both the screen and further revision in thinking about how cold this week’s weather will be, prices were in major rebound mode Monday. Double-digit gains were recorded across the board, with several points in both the East and West seeing upticks in the vicinity of 40 cents.

After suffering though a week’s worth of daily advances, bears finally got their chance Monday as extremely mild weather forecasts turned last week’s buyers of natural gas futures into sellers. When a quick uptick at the opening bell failed to surpass Friday’s $5.295 high, sell orders flooded into the trading pit. It took just an hour for the September contract to drop 25 cents Monday morning, nullifying about two-thirds of last week’s advance. It closed for the session at $5.083, down 19.7 cents on the day.

Adding to Monday’s advances, natural gas futures were higher on Tuesday as traders bid prices higher on technical bullishness and concerns over the possible formation of a tropical depression near south Florida. The September contract finished at $5.217, up 8.8 cents for the session, 18 cents for the week, and a whopping 63.7 cents off its low notched late last month.

Other than isolated softness at a couple of Rockies points and the Southern California border, the cash market ranged from flat to about a dime higher Wednesday. Although a majority of gains were quite small at a nickel or less, price movement was starting to be based more on hot-weather fundamentals and less on the screen’s previous-day performance.

Hot weather throughout most of the U.S. (with the exception of mild conditions in the Upper Midwest) spurred price increases ranging from about a nickel to 15 cents at nearly all points Monday. Continuation of firming numbers was in doubt, however, due to cold fronts in the Midwest and approaching the Northeast, with the one in the Midwest due to push on into the South over the next day or two.

Hype or not, Tropical Storm Claudette was the primary driver behind further moderate advances in the cash market Wednesday. Cold fronts were causing much of the Midwest and Northeast to lose some of the air conditioning load that had kept the regions sweltering earlier in the week, but major heat continued to dominate the weather picture in the West (outside the Pacific Northwest and California coast) and South. The screen wavered on either side of flat before eking out a meager gain of 1.7 cents on the day, and thus had little new influence on cash prices, one trader said.

Getting past a Democrat-imposed roadblock, the Senate Committee on Energy and Natural Resources finally green-lighted Republican Joseph T. Kelliher to serve on the Federal Energy Regulatory Commission. The action came after the White House last week announced its intention to nominate a Democrat, Suedeen G. Kelly of New Mexico, to also serve on the Commission.

Getting past the Democrat-imposed roadblock Wednesday, the U.S. Senate Committee on Energy and Natural Resources finally green-lighted Republican Joseph T. Kelliher to serve on the Federal Energy Regulatory Commission. The action came after the White House earlier this week announced its intention to nominate a Democrat, Suedeen G. Kelly of New Mexico, to also serve on the Commission (see Daily GPI, March 11).

Except for triple-digit advances for Dominion and Northeast citygates, the major volatility of recent days continued to subside Wednesday. It was also a second straight day of mixed price movement. Most of the East shared the Northeast-Dominion firmness but with much smaller increases; however, Chicago citygates and NGPL-Midcontinent saw drops of up to about 70 cents after a winter storm had moved eastward out of the Midwest market area.