Sift

Following Monday’s 8% price erosion and ahead of July expiration today, natural gas traders adopted a wait-and-see approach Tuesday, as light buying was slightly overpowered by continued short selling. At the closing bell, the July contract was 4.9 cents weaker at $3.397. Volume was light for a penultimate trading day with only 82,002 contracts changing hands.

Instead of trying to sift through all the issues relating to theshort-term and long-term transportation markets, Commissioner LindaBreathitt proposed that FERC first issue a limited rulemakingaddressing the less-controversial issues and save the more complexissues for later. “From what I’ve read in the comments [filed atFERC], the approach I am proposing appears to be one that many inthe market could support,” she said in a speech to the American GasAssociation Legal Forum in La Jolla, CA, last week.

For about an hour yesterday it appeared as if the futures marketwas ready to break out of its recent rut. Feeding on emotiongathered in Monday’s active session, the April contract quicklymapped out a 7-cent trading range in only the first hour oftrading. But, that would be about all the market could handle andthe prompt month spent the rest of the session drifting aimlesslywithin that range. April finished down 0.5 cents to $1.696.