Contrast

In sharp contrast with most of the energy forecasts from a few months ago — which called for a hotter than normal summer — this is likely to be one of the milder summers of the past decade, according to a report by Stephen Smith Energy Associates. The report, issued Wednesday, noted that cooling degree days collectively were 16% lower than normal for the past nine weeks.

Forecasts of a windy and chilly Wednesday in the Northeast were enough to give a small boost to citygates there, but otherwise the market Tuesday continued the trend of mild softness that has prevailed since last Friday.

For the second straight session, natural gas futures gapped lower at the opening bell. But in contrast to Monday’s session-long price retreat, the market rebounded Tuesday, pumping life into bulls who are suffering through some mild winter temperatures. The January contract finished at $6.143, down 18.1 cents for the session, but more than 20 cents above its low for the day.

For the third session in a row, natural gas futures opened in negative territory. However, in sharp contrast to the restrained buying seen Monday and Tuesday, the market accelerated higher Wednesday amid waves of technical and fundamental buying.

Little in the way of very cold weather was expected for the opening day of December, but its workday contrast to the long holiday weekend and a residual boost from the screen’s expiration-day strength Tuesday was sufficient to turn the swing market around Wednesday and yield mostly sizeable gains.

The natural gas industry has “turned a corner” in bolstering confidence in the system for reporting prices on gas trades to publishers of price indexes, said the head of FERC’s Office of Market Oversight and Investigations (OMOI) Tuesday.

Although freezing temperatures lingered on in Midwest and Northeast markets, weather-related demand was fading in the rest of the nation Monday, and it was only a matter of time before the Midwest and Northeast got their own warm-ups going. With a highly negative screen providing an extra push over the edge, it was hardly surprising to see cash prices falling between about 15 and 70 cents at nearly all points.

It was off to the races again in the Northeast Monday as multi-dollar spikes occurred at most citygates. But such strength was at odds with the general market, which showed a moderate bias to the upside in a mix of averages that ranged to about 20 cents up or down from flat.

There was a lot of contrast in price movement Thursday. After leaving the rest of the market way behind with numbers that had topped $20 in some cases the day before, Northeast citygates started to come back down to earth with multi-dollar plunges. Meanwhile, most other points (outside the Rockies) soared by about 30 cents or more. Some Gulf Coast pipes saw dollar-plus advances, with others there and in the Midcontinent rising nearly a dollar.