Physical

After ignoring forecasts of the coming winter storm back on Monday, traders of physical natural gas were forced to face the music on Wednesday as the same system that brought a white Christmas to portions of Texas was still depositing a wintry mix of sleet and snow from Oklahoma through the Mid-Atlantic and Northeast.

Physical gas prices rose on average a dime Tuesday as the Midwest and Midcontinent were bracing for the first major storm of the season. Rockies, Great Lakes and Midcontinent points all bounded higher. January futures rose 6 cents to $3.418, and February added 5.7 cents to $3.455. January crude oil gained 73 cents to $87.93/bbl.

The physical market lost a dime on average Thursday, but it was a mixed performance with gains in producing regions such as the Gulf Coast, Midcontinent and Rockies unable to offset free-falling prices in the Northeast and East.

Physical natural gas prices on average lost a whopping 36 cents Friday as the normal reluctance of buyers to commit to weekend gas was compounded by a weak screen, near-record gas in inventories, forecast warmth for the upcoming week in major energy markets and reports of ever-higher domestic production.

Physical gas prices declined on average by 9 cents Thursday as Northeast traders had to deal with constraints and cold weather, but there were milder conditions in the East and Gulf Coast region. The Energy Information Administration (EIA) reported that inventories increased 4 Bcf, but the market was expecting a modest draw, and futures prices took a double-digit beating. At the close January had fallen 15.3 cents to $3.648 and February was down 14.8 cents to $3.668. January crude oil added $1.58 to $88.07/bbl.

Physical gas prices overall on average rose a nickel Tuesday, continuing Monday’s stout advance. However, while a scattering of Gulf Coast points managed gains, hefty losses were noted in the Midwest, Great Lakes and in more than a handful of Northeast locations. Options strategies seemed to be in play for the December contracts, and at the close December futures had risen 3.9 cents to $3.769 and January was higher by 2.4 cents to $3.892. January crude oil fell 56 cents to $87.18/bbl.

Physical gas prices overall on average jumped a whopping 37 cents Monday as traders scrambled to deal with multiple challenges ranging from high power prices, to covering short positions, to below normal temperatures forecast for major eastern and Midwest energy markets. The Northeast was especially strong, with a couple of New England points registering gains north of $4.00. Futures traders were looking at more distant weather events and sold early and sold often. At the close December had fallen 17.1 cents to $3.730 and January was down 16.6 cents to $3.868. January crude oil fell 54 cents to $87.74/bbl.

Physical natural gas prices overall traded down an average of about a dime Thursday as most traders elected to get deals done prior to the release of Energy Information Administration (EIA) storage data.

Physical natural gas for weekend and Monday deliveries fell nearly 8 cents Friday as traders were reluctant to make purchases given the large amount of gas available and limited demand in a number of areas.