Drop

The Interior Department and its policies are a high priority of President Obama, said Michelle Obama Monday, who reportedly was the first First Lady to drop in at the agency since Eleanor Roosevelt.

Clearly showing the drop-off in demand and the increase in supply from new production, natural gas storage levels in the United States dropped only 195 Bcf for the week ended Jan. 30, which was one of the nation’s coldest weeks this winter. However, traders were actually expecting that only 190 Bcf would be removed for the week, so prices rebounded and ended up closing on the day at $4.642, up 4.5 cents from Wednesday’s regular session finish.

Continuing its recent run of ping-pong trade sessions, March natural gas futures followed Friday’s nearly 16-cent drop with a gain of 14 cents on Monday to close at $4.557. More importantly, the prompt-month contract put in a new low for the move in overnight Sunday trading — proving that the bottom is not in just yet.

The drop in natural gas and oil prices in 2008 will force many exploration and production (E&P) companies to write off a “huge” amount of reserves, Raymond James & Associates Inc. energy analysts said last week.

The drop in natural gas and oil prices in 2008 will force many exploration and production (E&P) companies to write off a “huge” amount of reserves, Raymond James & Associates Inc. energy analysts said Tuesday.

A recovery for natural gas prices in 2009 is unlikely, but as the rig count declines, it should set up supply to drop substantially at the same time the economy begins to recover, which bodes well for a more bullish 2010, energy analysts said last week.

Expectations of rising temperatures in the western half of the South, Midcontinent and Rockies combined with the previous day’s 8.9-cent drop by February futures to push prices lower in most of the cash market Wednesday. At least one source, however, thought there would be enough returning cold weather in the eastern U.S. and Canada by Friday to generate an overall rally Thursday.

A recovery for natural gas prices in 2009 is unlikely, but as the rig count declines, it should set up supply to drop substantially at the same time the economy begins to recover, setting up a much more bullish 2010, Raymond James & Associates Inc. said Monday. The energy team predicted that gas prices could average $8/Mcf by 2010, well above its $5 forecast for this year.

El Paso warned shippers Wednesday afternoon of the potential for a Strained Operating Condition (SOC), saying its linepack was expected to drop below 7,200 MMcf that night because of evening loads in the Phoenix area and the continuation of takes in excess of scheduled deliveries. However, the pipeline canceled the SOC warning Thursday due to customer response being sufficient to increase its linepack “to acceptable levels.” Washington Ranch storage remained on maximum withdrawal, El Paso added.