Milder

Futures and cash prices worked lower Wednesday, but physical gas posted sharper losses as forecasts of milder weather prompted cash quotes mostly a dime to 15 cents lower with some spots in the Northeast declining between 20 to 30 cents. At the close of futures trading March had shed 2.4 cents to $2.448 and April had softened 3 cents to $2.598. March crude oil added 30 cents to $98.71/bbl.

It wasn’t surprising to see a majority of points softening again Friday as weather continued to be milder than in most winters and the weekend was taking a bite out of industrial demand. What may have been a bit surprising to some was that quite a few locations were flat or managed to rack up small gains to keep mixed price movement in play.

January natural gas continued its march towards $3 as recent weather forecasts hint of milder conditions and a subsequent low withdrawal from storage inventories. At the close January had retreated 3.1 cents to $3.096 and February gave up 3.1 cents t $3.143. January crude oil gained 35 cents to $93.88/bbl.

Milder weather trends continue in the South, while temperature changes are mixed in various parts of the Midwest. Nevertheless, the continuation of winter-like conditions in much of the North American market assured that this week’s overall price advance extended into its third day Wednesday.

There were still a few softening locations in the market Monday, but it was strength all the way Tuesday. Slightly milder temperatures will be returning in parts of the South Wednesday, but they will be offset by cooling trends in the previously unseasonably moderate Northeast.

April natural gas futures rose Monday as end-users took advantage of sub-$4 pricing and discounted forecasts calling for milder if not unseasonably warm temperatures. At the close April had gained 11.8 cents to $3.927 and May rose 9.7 cents to $3.984. April crude oil added $1.02 to $105.44/bbl.

It appeared pretty certain that the New Year’s holiday weekend weather would be noticeably milder than that of the previous week. Yet Northeast citygates essentially halted their headlong plunges from a day earlier, and small gains dominated mixed movement in the rest of the market with few points straying very far on either side from flat.

The cash market largely shrugged off a prior-day drops of 3 cents by futures and some continuing trends toward milder weather in rising at a modest majority of points Wednesday.

With some notable exceptions in the Western Canada/Pacific Northwest area, most points fell Friday because of generally milder weather trends in some regions, the previous day’s 2.3-cent drop by December futures and the usual drop of industrial demand associated with a weekend.