Cent

Harnessing the momentum from Tuesday’s 15.3-cent plummet in December natural gas futures, traders continued to probe the downside Wednesday with mixed results. After starting the regular session with a low of $3.733, the prompt month contract reached a high of $3.800 just after 1 p.m. EDT before trimming lower to close at $3.749, down 3.2 cents from Tuesday’s regular session finish.

Virtually all of the cash market was down Friday as modest rebounds of high temperatures and a prior-day 4-cent decline by October futures proved unable to support continued firmness. The usual weekend drop of industrial load applied further downward pressure on cash numbers.

Finally responding to the 40.2-cent drop in front-month natural gas futures values from last Thursday’s high of $4.983, cash point averages across the board came off significantly on Tuesday for Wednesday delivery.

With Philadelphia temperatures expected to peak around 90 Wednesday, the combination of a mini-heat wave in the East, a 15.8-cent advance by July futures on the previous Friday and the restoration of industrial demand that had been missing during a long holiday weekend caused double-digit price gains across the board Tuesday in the launch of the June aftermarket.

It was not surprising that prices continued to drop at nearly all points Friday. Generally moderate weather almost everywhere, a 10.4-cent dip by June futures a day earlier and the usual weekend loss of industrial load were all bearish influences on Friday’s cash market.

Appearing to be pretty comfortable with the current price level, natural gas futures traders nudged the expiring May contract around a 6.5-cent range on Wednesday before it went off the board at $4.377, down a penny from Tuesday’s regular session finish. June futures didn’t display much more oomph as what is now the new front-month contract closed the day at $4.408, down 3.6 cents from Tuesday’s close.

May natural gas futures were limited to a narrow 6-cent trading range and fell nominally as risk managers noted an uninspired market, and described their methodology for wringing value from a low-volatility trading environment. At the close May had eased 2.3 cents to $4.389 and June shed 1.4 cents to $4.452. June crude oil lost a penny to $112.28/bbl.

May futures were slightly lower on the day Friday, but traders saw fresh buying entering the market. The buying came late in the session and sparked an 8-cent rally to pick the market off session lows. At the close May was lower by 2.7 cents to $4.362 and June eased 2.1 cents to $4.437. May crude oil continued higher, adding a hefty $1.22 to $107.94/bbl.

Arkansas state Rep. Tommy Lee Baker (D-Osceola) has withdrawn legislation (HB 1992) that would have ended severance tax exemptions for natural gas drillers due to a lack of support in the House Insurance and Commerce Committee.