Cent

As a Gulf Coast trader had predicted Thursday, the 22.5-cent spike by futures that day was able to generate modest firmness in most of the cash market Friday. The screen boost was abetted by increases in cooling load in Texas and the Midcontinent, while the weekend decline of industrial demand had minimal impact.

Tuesday’s overall rebound in the cash market didn’t last very long as quotes fell at all points Wednesday. Besides the drag of a 12.9-cent futures decline a day earlier, Wednesday’s market was forced to acknowledge that already-light weather-based demand was tending to recede even further.

While the cause of Wednesday’s rally in natural gas futures remains up for debate, the reality is that the June contract erased Tuesday’s 11-cent drop by climbing most of the day to close at $3.887, up 27.2 cents from Tuesday’s finish. The talk among traders on the day was that the upward price action was caused by fund buying, a rupture on Panhandle Eastern Pipe Line, Jim Cramer’s bullish prognosis, or some mixture of the three.

Depending largely on the previous Friday’s 17.3-cent run-up by June futures and the return of industrial load from its typical weekend time-out, prices were up across the board Monday. One source thought a modestly bullish upturn in general economic developments may have been an additional boon for the spot market.

Despite little appreciable increase in significant weather-based load, a 3-cent drop by June futures a day earlier and the weekend impact on lowering industrial demand, cash prices were able to realize modest gains at most points Friday.

Moving in one-day delay lock-step with front month natural gas futures, cash market traders took their cue from the 18.8-cent drop in the May futures contract on Monday as almost every single cash point average recorded a decline on Tuesday.

May natural gas futures were unable to sustain Friday’s 13-cent advance and stumbled badly as weaker crude oil and equity markets set a negative tone to the day’s trading. Analysts see no reconciliation between plump production and recession-diminished demand for another two quarters and suggest things could get really grim if next winter is mild.

Prices continued to fall at nearly all points Friday due to generally mild weather forecasts and the previous day’s 9.4-cent decline by May futures. The typical weekend decline of industrial load was an additional bearish factor.

After inching higher to close last week’s action, May natural gas futures on Monday traded in a tight 9.8-cent range before closing out the regular session at $3.732, down 6.9 cents from Friday’s finish.