Penny

Physical natural gas prices on average gained a penny in trading for Tuesday deliveries, but California prices soared as next-day power made huge weather-driven gains. Northeast locations were also strong, but many market hubs were flat to within a couple of pennies higher or lower.

Cash prices added less than a penny overall in Thursday’s trading as traders got their deals done ahead of the release of government inventory figures.

The cash market took a breather from bidweek activities and managed to trade less than a penny higher overall Wednesday. Weakness at Midwest points was made up by some strength in New England and eastern points as hot, humid weather was forecast for the next three days. At the close of futures trading September had eased 3.8 cents to $3.171 and October fell 4.1 cents to $3.171 as well. September crude oil added 85 cents to $88.91/bbl.

The cash market overall Tuesday was on average a penny higher with mild strength evident in most regions. More than a handful of Northeast points weakened. Futures found the rarefied air of Monday’s gains unsustainable and recorded a double-digit loss. At the close August had dropped 14.6 cents to $2.737 and September had lost 14.8 cents to $2.728. August crude oil dropped $2.08 to $83.91/bbl.

Cash quotes overall inched higher by about a penny, but flat to lower quotes at a few spots in the Great Lakes and Northeast were offset by firm Rockies prices and restriction-derived gains of about a nickel in California. The Energy Information Administration (EIA) reported a build of 30 Bcf, about what the market was looking for. Prices slumped initially but managed to climb back into the plus column before closing. At the end of the day June futures were 2.2 cents higher at $2.487 and July gained 1.9 cents to $2.569. June crude oil rose 27 cents to $97.08/bbl.

Cash prices traded close to unchanged Thursday with most quotes a penny or two higher or lower. However, Northeast prices shot higher primarily on supportive weather conditions.

It’s well documented by now that due to low natural gas prices a number of producers and oilfield service companies have been switching drilling efforts and asset buildup from the primarily dry gas Haynesville to “wetter” [that is, richer in crude oil and natural gas liquids (NGL)] plays such as the Eagle Ford and Marcellus. But quite a few in the industry see Haynesville as remaining a strong shale resource and eventually strengthening. It may take a few years, but many expect gas prices to eventually begin making up for ground lost to the soaring crude market.

The cost of being regulated by the Nevada Public Utilities Commission (PUC) went down Wednesday — by a fraction of a penny (1/200th of a cent to be exact). The three-member PUC voted unanimously to lower its assessment against all of the private-sector utilities it regulates to 1.90 mills from 1.95 mills.

With little to no direction from the natural gas futures market on Monday, which gained a mere penny, cash market traders on Tuesday were left up to their own devices. While most cash market points posted small gains on the day, the Northeast region recorded some significant drops as weather and temperatures relaxed.