Settling

While settling down to a pace described as “sedate” compared to the frenzied activity of the last two winter work seasons, western Canadian drilling instead appears to be chasing bigger natural gas targets.

Bringing the consecutive down-day streak to seven, June natural gas futures on Friday reached a low of $6.490 before settling at $6.555, down a quarter on the day and $1.661 lower than the contract’s close the previous Friday. During the eventful week, May futures expired on Wednesday at $7.198.

Rebounding from Monday’s 24.3-cent decline, April natural gas futures on Tuesday climbed as high as $6.750 before settling at $6.678, up 13.1 cents for the day. Despite the bounce, market experts said the level of bearish fundamentals in the market right now would make any sort of significant rally difficult.

Settling lower for the fifth consecutive regular session, March natural gas futures on Friday brushed off winter storm concerns for the weekend en route to carving out a new low for the move at $7.250. The prompt month finished the week at $7.316, down 16.3 cents from Thursday but an astounding $1.297 lower than the contract’s close in the prior week.

March natural gas futures traded within a relatively quiet 30-cent range Tuesday before settling at $9.316, down 7.3 cents from Monday. The interesting thing about the otherwise mundane session was that the market saw almost no correction to Monday’s 88.2-cent gain.

While natural gas futures continue to work lower, the declines are no longer in 50-cent increments. February natural gas chiseled out a new low for the move of $9.130 on Wednesday before settling at $9.238, down 9.8 cents.

After trading within one of its smallest ranges in months, February natural gas futures on Tuesday basically called the day a wash, settling 2.4 cents lower at $9.336. Trading flip-flopped from gains to losses for a majority of the session while remaining within a tight 27-cent range from $9.280 to $9.550.

FERC last Thursday issued a proposed rule aimed at reducing the time and expense involved in settling disputes that arise when parties move to change the terms of their jurisdictional wholesale natural gas and power sales contracts.

Disregarding the bullish natural gas storage report, January natural gas on Thursday dropped significantly for a second consecutive session, reaching a low of $13.750 before settling at $13.781, down 89.8 cents for the day. This brings the two-day decline total to $1.597, while the week’s decline so far stands at 53.1 cents.