Nudge

Although natural gas prices “remain at historically low levels,” producers should tip their hats to gas-fired power generators for doing their part to nudge demand up for the year, according to data released Tuesday by the Energy Information Administration (EIA).

Seeing little in the way of new fundamental influences and getting only a late nudge downward from the storage report, the cash market generally marked time Thursday. Nearly all points were about a dime or less up or down from flat, with moderate gains in the majority. Upticks of 20 cents or more in quotes for San Juan Basin and Northwest (South of Green River) were the major outliers from the overall market.

Natural gas futures sagged at the open and then again at theclose yesterday, but in between the price action was positive astraders continued to grapple with disequilibrium of supply anddemand in the physical market. The September contract finished at$4.685, up 5.7 cents on the day and just to the north of the centerof its wide, 20-cent range. Estimated volume was healthy withoptions-related futures dealings boosting the number of contractsthat changed hands to 73,860.

Wednesday marked the first time in a week that double-digitmoves were nowhere to be found in the cash market. Most pointsregistered small gains of 2 to 5 cents, feeding off a strongfutures screen and a bullish American Gas Association (AGA) storagereport of a 26 Bcf injection.

In what some sources referred to as “winter’s last hurrah,” cashprices began the week on an up-note as they garnered momentum froma futures rally and continued covering of first-of-month shortpositions. Cash prices at most trading areas around the countrygained 1-3 cents from weekend levels.

A modest nudge from the futures screen and a warming trend inmajor market areas that had been unseasonably cool in recent dayswere enough to generate an overall upturn in cash prices Tuesday.The increases ranged from negligible to just over a dime in somecases.