Hefty

September natural gas futures rose a stout 11.8 cents to settle at $6.208 as traders touted the still hefty discount of natural gas to the petroleum complex and the idea that weather-driven higher prices would ultimately occur.

With little to no air conditioning demand across the country for the week ended May 25, the Energy Information Administration (EIA) reported Thursday morning that a hefty 107 Bcf of natural gas was injected into underground storage. While the number was mostly in line with expectations, the July natural gas futures contract traded between $7.812 and $7.970 before settling at $7.935, down less than a penny from Wednesday’s close.

Hefty litigation costs and accounting adjustments pushed Williams Cos. to a loss in the second quarter. However, with natural gas production jumping 20% from a year ago to 786 MMcf/d and a strong performance from its midstream business, the Tulsa-based gas producer and distributor raised its profit and capital expenditure guidance through 2008.

Hefty litigation costs and accounting adjustments pushed Williams Cos. to a loss in the second quarter. However, with natural gas production jumping 20% from a year ago to 786 MMcf/d and a strong performance from its midstream business, the Tulsa-based gas producer and distributor raised its profit and capital expenditure guidance through 2008.

The market was hit with hefty losses across the board Friday, coming under pressure from relatively light cooling load outside the southern half of the U.S., a 14.9-cent screen drop on Thursday and increasing concerns about a potential future price crash when most available storage injection space gets eliminated. Of course, the decline of industrial load that is typical of a weekend also played a role.

Reflecting a get-tough policy to improve pipeline operator safety, federal pipeline safety regulators have proposed a hefty $600,000 fine against Williams’s Transcontinental Gas Pipe Line for federal violations that resulted in the release of natural gas and evacuation of school children and residents in a densely populated area in northern Virginia in October.

Ontario’s pipeline safety regulators have charged Enbridge Gas Distribution Inc. and two other companies with negligence in connection with a pipeline explosion last April in Toronto that killed five persons, left several injured and caused extensive property damage.

After averaging a hefty 91 Bcf a week in storage injections since April, the natural gas market fell sharply off that pace last week with a 53 Bcf refill, prompting some market observers to rethink how much the blackouts affected gas demand. Using that bullish news as an updraft, the October futures contract soared immediately to $5.08 following the 10:30 a.m. EDT report.

After checking higher yesterday morning, natural gas futures made another push to the upside early in the afternoon as traders digested the latest natural gas storage supply data. The October contract received the biggest boost, shuffling 6.1 cents higher to close at $2.420.