Crept

Despite “a major supply glut,” the natural gas-directed rig count has crept up, and oil-focused drilling in shale plays also is yielding natural gas, so analysts at Bank of America Merill Lynch (BofA) have raised their 2012 forecast for production growth and cut their price forecast.

Despite “a major supply glut,” the natural gas-directed rig count has crept up, and oil-focused drilling in shale plays also is yielding natural gas, so analysts at Bank of America Merill Lynch (BofA) have raised their 2012 forecast for production growth and cut their price forecast.

This week’s price run-up appeared to be faltering Wednesday as increases got much smaller and a bit more softness crept into the market. There was still plenty of heat to go around for Thursday, but the modest psychological boost of a tropical storm off the Mexican coast apparently was wearing off quickly and some anticipation of the weak-demand holiday weekend may have had quite a few traders backing off purchases in preparation for avoiding positive imbalance penalties.

It’s far from a done deal, but the potential for export of U.S. natural gas from the Lower 48 states crept closer last week with announcements by Cheniere Energy Partners LP that it is in talks with two parties for capacity on its gas liquefaction and export facilities proposed for the Sabine Pass liquefied natural gas (LNG) terminal in Cameron Parish, LA.

December natural gas futures quietly crept higher Wednesday as reports circulated that the industry could see an early withdrawal from natural gas storage when the Energy Information Administration (EIA) releases its report Thursday morning for the week ended Oct. 27. The prompt month ended up settling 17.8 cents higher at $7.712.

After pushing the February contract up to a $6.51 high just after 11 a.m. (EST), gas futures traders encountered a little bit of vertigo in afternoon trading as the market crept lower instead of approaching $7. The prompt month settled 1.5 cents lower at $6.388, while March futures, poised to take over as prompt month in Thursday Access trading, closed down 2.3 cents at $6.421.

Prices crept mildly higher in most cases Tuesday, continuing tofeed on an early preview of winter in much of the East. A greatmajority of points ranged from flat to about a nickel higher.Exceptions included downturns for Northwest-domestic, SouthernCalifornia border and a few Northeast citygates, along with aPG&E citygate gain of about 15 cents.

The July Nymex futures contract crept up another 2.9 cents tosettle Tuesday at $2.391, as hot weather and subsequent strong cashmarket prices continued to support the futures strip. July reacheda high of $2.41 on the day, which is just 2 cents shy of its nextresistance level. However, one source feels the spot month may havetrouble breaking that level in regular trading today since heexpects many traders to stay on the sidelines in anticipation ofthe latest AGA storage report, to be released this evening.

The April Nymex contract crept 3.5 cents higher to $2.365 onWednesday, as traders continue to hold the spot month to smalldaily changes ahead of the contract’s expiration this Friday. Aprilmanaged to reach $2.40 before intraday profit taking drove thecontract back, a source told GPI. Total estimated volume came in at70,152 contracts.