Selling

After posting modest gains last Thursday, the futures marketagain succumbed to selling pressure Friday as traders tried to pushthe December contract below support at $2.25. But, $2.265 was asfar as the contract could plumb and the prompt month was left tosettle for the week at $2.275. Sources pointed to bearishfundamentals and weak, last-day prices as reasons for the decline.

The futures market followed an early example set by the cashmarket on Tuesday, as early selling fueled by losses in Monday’sAccess trading pushed the market lower for the second day in row.That enabled the November contract to not only gap lower at theopen, but also to gap below key support at $2.35 on its way to alow of $2.295. However, the buyers saw good value at those levelsand bid up the contract to its settle at $2.346, a 4.7 cent lossfor the day.

Spirit Energy 76, Unocal Corp.’s Lower 48 exploration andproduction unit reached a definitive agreement to sellsubstantially all of its oil and gas assets in Michigan to NewstarEnergy USA Inc. and Omimex Energy Inc. for about $37.25 million incash and 670,000 shares of stock in Newstar Resources, the parentcompany of Newstar Energy.

Nova Corp. announced yesterday it is selling its 26% interest(38.8 million shares) in Dynegy Corp. (formerly NGC Corp.) andplans to redeploy the potential $460 million in proceeds in itscommodity chemicals business. Nova CEO Jeffery Lipton said themarket is “currently assessing little or no value to ourinvestment” in the Houston-based marketing and processing company.

The futures market opened lower on Thursday, but aftersustaining an initial round of selling, the prompt month managed toclaw its way back up to $1.817, a 0.2 cent decline for the day.That left the September contract still perched just above long term support at $1.78 yesterday, trading within a narrow 4-cent range.Estimated volume registered an unremarkable 40,943.

In the aftermath of selling its bulk energy marketing arm,Consolidated Natural Gas (CNG) said it plans to shift its focus toCNG Producing, its New Orleans-based E&P arm, which willsignificantly increase over-all oil and gas production next year asthree key offshore pipeline projects come into operation. Much ofthe increase is expected to come from its production activities inthe Gulf of Mexico.

For the fifth Monday in a row the bears were dominant in the pitat Nymex as trade and speculative selling pushed natural gas down,effectively erasing gains registered on Friday. Most of the day’smovement happened on the open, leaving the August contract to tradein the mid $1.90s for the rest of the day before closing at $1.965,down 6.6 cents.

Consolidated Natural Gas Co. followed through on its plan toexit wholesale energy marketing yesterday by selling its gasmarketing operations, including supply, sales, storage andtransportation agreements, to Sempra Energy for $48 million.