Combination

After receiving a combination of supportive storage and weather news Monday morning, natural gas traders lifted the futures market off its early session lows and notched a 15-cent advance in just 45 minutes. The market moved sideways throughout the afternoon as technical selling associated with congestion in the $4.35 area from last week was enough to corral bulls. January closed at $4.32, up 12 cents for the session.

A combination of above-market priced, long-term contracts and demand-side programs is the best formula for avoiding a return of high prices and power blackouts, the California Consumer Power and Conservation Financing Authority concluded at a recent board meeting in Sacramento. It is pointing the state toward achieving reserve levels of more than 20%, with ideally half coming from the demandside.

Undeterred by the combination of telecommunications and energy industry financial meltdowns this year, an affiliate of San Diego-based Sempra Energy still expects a slow but steady growth in its seven-patent-ending “fiber links” technology for threading fiber optic cable through natural gas distribution pipeline mains and service lines in dense urban commercial and suburban residential areas.

Buoyed by the one-two combination of hot weather forecasts and higher cash market prices, particularly in the Northeast, natural gas futures prices moved higher Wednesday on fresh commercial buying mixed with light speculative short covering. After trudging methodically to a $3.04 high at 1 p.m. EDT, the September contract fell in the last 90 minutes of the session as traders positioned themselves ahead of this mornings release of the weekly gas storage report. The prompt month closed at $2.954, up 6.3 cents for the day, but 8.6 cents off its daily high.

Undeterred by the combination of telecommunications and energy industry financial meltdowns this year, an affiliate of San Diego-based Sempra Energy still expects a slow but steady growth in its seven-patent-ending “fiber links” technology for threading fiber optic cable through natural gas distribution pipeline mains and service lines in dense urban commercial and suburban residential areas. The president and several other senior executives with Sempra Fiber Links were in Portland, OR, Monday at a national meeting of state regulators, pitching their system as being a fast, safe, less costly and environmentally more benign means of bringing fiber optics to commercial and residential areas that are among more than 90% of the nation that is still dependent on copper phone wires.

Amid the bullish combination of cold temperatures in the short-term outlook and warm temperatures in the long-lead forecast, natural gas futures rallied to their highest weekly close in five months Friday on continued short-covering by large speculative traders. The April contract received the biggest buying boost, trading 15.2 cents higher to close at $3.076. In doing so, it moved through resistance clustered at early-week highs in the $3.03-04 area.

The combination of Conoco Inc. and Phillips Petroleum Co., announced a week ago in an enterprise deal valued at $53.5 billion, will create the third largest integrated U.S. energy company, and also reduce the number of majors overall. ConocoPhillips, as it is set to be called when the merger closes, would be the third largest U.S. company based on market capitalization and oil and gas reserves and production. Worldwide, it would be the sixth largest.

There were no expiration day heroics for bulls Wednesday. Despite the bullish combination of extremely oversold conditions and modestly constructive storage data, natural gas futures tumbled again as traders used the September contract as a battering ram to reach a new 19-month low. Including Wednesday’s 12-cent decline and $2.295 close, the September contract suffered losses in each of its last 10 trading sessions, trimming a whopping $1.17 or 34% from its Aug. 15 value.

Amid a stunningly bullish one-two combination of a tropical depression and a record low storage refill for the month of August, natural gas futures soared higher to test one-month highs yesterday as traders covered shorts initiated on recent moves below the $3.00 mark. The September contract rode the buying wave for a 37.4-cent advance, breaking through several levels of resistance on its way to a $3.468 closing price.