Diminishing

Although temperatures are rising in much of the West, they were diminishing in sections of the South, and despite chilly conditions lingering for at least another day or so in the Midwest, the region is due to see a warming trend toward the weekend. The modestly bearish weather influences, which reversed marginal support for Tuesday’s cash market, combined with the 3.1-cent fall by October futures Tuesday to drive quotes lower at a large majority of points Wednesday.

Driven largely by a futures plunge of 60 cents a day earlier, cash prices fell by large amounts at all but one point Tuesday. Slightly diminishing cooling load in several areas and the growing certainty that Hurricane Bertha will remain a nonevent for Gulf of Mexico production added to the bearish mood.

With political tensions and diminishing onshore reserves around the world, the deepwater is “virtually the only place” where giant oil and natural gas fields will be found in the future, the managing director of UK-based Douglas-Westwood told a Houston audience Thursday.

With political tensions and diminishing onshore reserves around the world, the deepwater is “virtually the only place” where giant oil and natural gas fields will be found in the future, the managing director of UK-based Douglas-Westwood told a Houston audience Thursday.

Most points responded to forecasts of cold fronts, diminishing cooling load in several areas and Wednesday’s expiration-day weakness of September futures by ranging from flat to down about 30 cents Thursday. The Rockies, however, continued to recover from their maintenance-related plunges in the first two days of the week by rising as much as about 70 cents.

The cash market finally bowed — but not totally — to the reality of weak weather fundamentals and the steadily diminishing possibility of Tropical Storm Florence even reaching North America, much less the Gulf of Mexico. Although a majority of points recorded moderate losses Thursday, there were still quite a few that were flat to a dime higher.

Amid diminishing concerns about Tropical Storm Bonnie and Hurricane Charley, the natural gas futures market shuffled lower Wednesday, quickly rescinding nearly all of the gains notched over the previous two trading sessions. The September contract was the biggest loser, dropping 17.7 cents to close at $5.614. By comparison, the out-months fared much better, enabling the five-month winter strip (November-March) to sustain only a modest, 6-cent decline to $6.684.