Relief

Natural gas futures traders mostly breathed a sigh of relief Thursday morning as the outsized 108 Bcf injection of the previous week’s natural gas storage report proved to be a one-time thing. However, despite an only slightly bearish 93 Bcf injection report this week, October natural gas futures plumbed two-year old support before closing at $4.781, down 15 cents on the day.

Rep. Edward Markey (D-MA), a strong proponent of ending liberal royalty relief for producers, assailed the Bush administration Wednesday for not being tough enough with producers to resolve the debacle over royalty-free deepwater oil and natural gas leases.

Just when it appeared that this week’s general relief from the previous week’s heat wave and a weak screen would preclude any cash market rallies, a moderate one showed up Tuesday at a majority of eastern points. Although peak temperatures are staying seasonal to even cool in some cases in most northern market areas, highs in the 90s and 100s are growing common again across the southern half of the nation.

Prices were mixed but mostly softer Wednesday as some relief from inferno-like heat indexes will be spreading Thursday through the Midwest and arriving later in the Northeast.

The Michigan Public Service Commission (MPSC) decided Tuesday to establish emergency billing practices to create some relief for customers from high natural gas and power costs this winter.

Consumers are likely to see very little price relief next year, according to two industry prognosticators. Arlington, VA-based consulting firm Energy and Environmental Analysis Inc. (EEA) is predicting gas prices will average $9/MMBtu in 2006, while analysts at Raymond James & Associates say extremely bullish underlying fundamentals will keep prices between $9.50 and $10 next year.

Just days after the natural gas industry sighed in relief after Hurricane Ophelia chose the Atlantic path instead of the Gulf of Mexico course, Tropical Storm Rita looks as if she might not be as accommodating. Fears over the storm’s projected Gulf path sent futures off to the races in Access trading Sunday night and again on Monday, with October natural gas settling $1.519 higher at $12.663, a new all-time prompt month record.

Taking their cue from weakness on the petroleum side as well as a sigh of relief regarding Hurricane Ophelia’s path, October natural gas futures on Monday explored lower, breaking below $11 at one point before settling at $11.031, down 23.2 cents on the day.

The energy industry breathed a sigh of relief Thursday morning as the Energy Information Administration reported that 123 Bcf was pulled from underground natural gas storage for the week ended Dec. 17. While higher than most expectations, the draw remained within the industry’s projection range — unlike the erroneous pre-Thanksgiving report that threw the market into chaos.