Mild

Unseasonably warm weather reduced energy demand in the Northeast, lowered prices and cut into KeySpan’s fourth quarter earnings. The company reported slightly lower earnings, excluding special items, of $99 million, or 71 cents per share, down from $100.9 million, or 75 cents per share, a year earlier. Wall Street analysts had expected earnings of 73-78 cents per share, with a consensus estimate of 75 cents. Including special items, earnings fell to $34.4 million, or 25 cents per share, from $58.9 million, or 44 cents per share.

Amid updated weather forecasts confirming the warming trend that is set to engulf the entire Eastern half of the nation this week, natural gas futures dove lower Tuesday, as traders returned from the holiday weekend and promptly liquidated long positions initiated early last week. February took the selling squarely on the chin, gapping lower at the open bell, and not once looking back as it came just one tick away from notching a new contract low at $2.094. It closed with an even 13-cent decline at $2.106.

Given the mild winter, the natural gas piled up in storage and the crippled economy, gas prices are expected to limp along in the $2.00 to $3.00 range for most of 2002, but watch out for the winter of 2003-2004; it could be a real zinger, with prices closing on $4.50, according to projections by Ben Schlesinger & Associates (BSA).

Given the mild winter, the natural gas piled up in storage and the crippled economy, gas prices are expected to limp along in the $2.00 to $3.00 range for most of 2002, but watch out for the winter of 2003-2004; it could be a real zinger, with prices closing on $4.50, according to projections by Ben Schlesinger & Associates (BSA).

Flatness dominated the cash market Wednesday as most points showed little price movement and the remaining small increases and decreases tended to cancel each other out. If anything, however, there was a slight bias to the downside. Most of the upticks were in the West, while Gulf Coast and Northeast points saw more of the larger downticks.

Armed with bearish technical data and fundamental news, traders at the New York Mercantile Exchange wasted little time yesterday as they pressured natural gas futures back below the psychologically important $3.00 mark. Selling was seen from the outset Monday, as traders initiated the daily session with a whopping 14-cent, gap-lower open on the daily chart. The December contract never recovered, sifting lower through the morning only to move sideways during the afternoon. The prompt month closed at $2.922, down 32.6 cents for the day.

In contrast to forecasts by the National Oceanic and Atmospheric Administration (NOAA) and Salomon Smith Barney of a colder-than-normal winter in key eastern consuming regions, WSI Corp.’s end-of-October update to its seasonal forecast for November, December and January predicts warmer-than-normal temperatures in the Northeast, Mid-Atlantic and in the central and southern Plains. WSI, however, said it expects cooler-than-normal temperatures in the Gulf Coast states, Northern Plains, Great Lakes states, and all areas west of the Rocky Mountains.

In contrast to forecasts by the National Oceanic and Atmospheric Administration (NOAA) and Salomon Smith Barney of a colder-than-normal winter in key energy consuming regions, WSI Corp.’s end-of-October update to its seasonal forecast for November, December and January predicts warmer-than-normal temperatures in the Northeast, Mid-Atlantic and in the central and southern Plains. WSI, however, said it expects cooler-than-normal temperatures in the Gulf Coast states, Northern Plains, Great Lakes states, and all areas west of the Rocky Mountains.

Last week’s market closed on a “relatively” sedate note Friday, at least relative to the preceding trading fireworks. But the downward price movement was still being measured in double digits in nearly all cases.