Point

With natural gas futures playing a supportive role on Monday, cash point averages on Tuesday for Wednesday delivery continued to record increases across the board.

Wednesday’s rally in the face of bearish weather demand proved to be a fluke as prices fell at all but one point Thursday in trading for the Good Friday/Easter holiday weekend. Prior-day futures softness and the extra loss of industrial load during a long holiday weekend also figured into the cash losses.

Wednesday’s rally in the face of bearish weather demand proved to be a fluke as prices fell at all but one point Thursday in trading for the Good Friday/Easter holiday weekend. Prior-day futures softness and the extra loss of industrial load during a long holiday weekend also figured into the cash losses.

Northern Natural Gas has implemented a System Overrun Limitation until further notice at the Gilmore City #1 point Friday, saying it was due to sustained flows in excess of facility capacity.

The previous day’s gain of 9.8 cents by prompt-month futures must have done most of the heavy lifting in propelling all but one cash point higher Wednesday because besides some moderate temperature declines forecast for Thursday in parts of the Northeast, Midwest and Pacific Northwest, there were few additions to heating load to be found.

All signs point to higher natural gas prices in early 2010, the energy team at Tudor, Pickering, Holt & Co. Securities Inc. (TPH) said Tuesday. According to TPH models, the plunge in drilling activity from the peak in 3Q2008 should result in wellhead supply declining by 5 Bcf/d, or 8%, at the end of 2009 from year-end 2008.

There was near-unanimity last week at the Commodity Futures Trading Commission (CFTC) hearings on one point — that position limits are needed to to curb excessive speculation in energy commodity markets. But the consensus unraveled when it came to the details — who should set position limits, who should be exempted from the limits and at what level the position limits ought to be set.

Calling the deal “a strategic entry point into one of the largest emerging natural gas plays in North America at an attractive price,” Williams on Monday closed a joint venture agreement with Atlas Pipeline Partners LP that provides the company access to the Marcellus Shale.

The domestic natural gas market should reach a “fundamental inflection point” in June and be “increasingly underbalanced” in the last half of the year, SunTrust Robinson Humphrey (STRH) analysts said Thursday.