Digested

November natural gas weakened again Friday as traders digested reports of additional drilling for natural gas and a production dynamic that continues to point to greater output. At the close November had fallen 8.1 cents to $3.666 and December had given up 5.3 cents to $3.962. November crude oil retreated $2.94 to $79.20/bbl.

October natural gas continued to erode Thursday as traders digested a government report of an above-average injection of 89 Bcf. The decline was less than some expected, and analysts noted the relative resilience of natural gas to an otherwise deteriorating oil and equity market environment. October slipped 2.5 cents to $3.705 and November retreated 3.8 cents to $3.782. November crude oil imploded $5.41 to $80.51/bbl.

September natural gas fell Thursday as the market digested a storage report showing additions to inventory above what the market was looking for. The Energy Information Administration (EIA) reported a build for the week ended Aug. 12 of 50 Bcf while traders were expecting about 5 Bcf less. At the close September had fallen 4.1 cents to $3.892 after trading as low as $3.843 and October had given up 4.4 cents to $3.899. September crude oil followed free-falling financial markets and dropped $5.20 to $82.38/bbl.

June natural gas futures declined Thursday as traders digested an inventory report about in line with expectations but well ahead of last year’s injections. A subsequent release of a government hurricane forecast did little for the bullish cause either, and prices settled at the low end of the day’s trading range.

April natural gas futures continued lower Thursday following a brief jump as traders digested a report showing an 85 Bcf decline in natural gas inventories, in line with earlier estimates. By the end of the day April was down 4.0 cents to $3.778 and May had fallen 3.5 cents to $3.859. April crude oil fell 32 cents to $101.91/bbl.

August natural gas futures fell Tuesday as traders digested economic reports showing figures that were less than what analysts had expected. Longer-term technical traders note that the market is moving within a broad trading range but have their parameters in place to identify when the market is ready to stage a meaningful advance.

April natural gas futures in its first regular session action as the front-month contract on Thursday digested the morning news that 101 Bcf was withdrawn from underground storage last week with little more than a blip on the charts. Prompt-month futures failed to drop below the psychological $4 price level and ended up closing at $4.077, up 4.8 cents from Wednesday’s close.

Cash market points were lower across the country Wednesday as the eastern heat wave of the last few days waned and traders digested two consecutive down days of futures values.

While traders digested the news of an unusual net decline in storage in the middle of the traditional injection season, cash prices rose Thursday at most points. The continuation of hot weather in many regions and a screen spike on Wednesday were the chief instigators of the overall rally, but bullish anticipation of a low storage injection or possibly even a withdrawal likely also played a part, one source said.