Moderate

The spot market saw mixed price movement Tuesday, but softening points were in a clear majority. Relatively moderate conditions in most of the Northeast and a reduction of strong heat developing in the western South lowered much of the weather-based load that had lifted nearly all locations a day earlier. Monday’s 6.6-cent drop by prompt-month futures was a further depressant for the Tuesday market.

Where is rising gas supply supposed to go? New and ongoing restrictions on storage injections, moderate springtime weather being prevalent and a five-day string of futures losses pressured the cash market into losses at nearly all points Friday. The usual weekend decline of industrial load was an additional, albeit minor, bearish factor.

Shale formations are poised to create a renaissance in the U.S. petrochemical industry, Williams CEO Alan Armstrong said Wednesday.

April natural gas futures continued their descent Wednesday as traders had to digest more moderate weather forecasts and sensed that although the market continues to hold technical support, it is just a matter of time before prices fall again. At the close April natural gas had fallen 5.5 cents to $3.818 and May dropped 5.6 cents to $3.894. April crude oil continued its sub-orbital flight path, adding $2.60 to $102.23/bbl.

March natural gas futures fell in moderate trading Wednesday as traders noted the market’s continued inability to reposition itself above the psychologically important $4 resistance level. At the closing bell March futures were 5.5 cents lower at $3.921 and April had lost 6.9 cents to $3.961. March crude oil posted a gain of 67 cents to $84.99/bbl.

Next-day forecasts still relatively moderate, but traders see heating load increases nearby.

Still-moderate weather fundamentals for the most part didn’t seem to offer any rationale, but prices recovered some lost ground at all points Monday following an extremely weak weekend market. Without any new developments from previously mostly mild to cool weather, it seemed that at least a bit of “storm hype” must have crossed traders’ minds.

Moderate to cool conditions were still dominating the overall forecasts, and as a couple of sources had pointed out, Thursday’s 24.8-cent screen plunge “practically guaranteed” lower prices Friday. They were correct as quotes fell across the board from about C5 cents to 30 cents or so; all drops were in double digits except for those at Empress and NOVA Inventory Transfer in Western Canada.

Perhaps due to a little heating load starting to appear in some northern and western market areas, along with moderate warming trends returning in the South, the market found enough weather-based support to see modest gains at a small majority of points Tuesday.