Sliding

Erosion of the international natural gas trade continued into the 2009-2010 heating season with Canadian sales into the United States sliding steadily downhill. The best that can be said for pipeline exports is that the rate of decay slowed in December, the second month of the current contract year, which began Nov. 1.

Erosion of the international natural gas trade continued into the 2009-2010 heating season with Canadian sales into to the United States sliding steadily downhill. The best that can be said for pipeline exports is that the rate of decay slowed in December, the second month of the current contract year, which began Nov. 1.

Erosion of the international natural gas trade continued into the 2009-2010 heating season with Canadian sales into to the United States sliding steadily downhill. The best that can be said for pipeline exports is that the rate of decay slowed in December, the second month of the current contract year, which began Nov. 1.

Tuesday’s 18-cent drop by January futures proved to be more influential to the cash market than sliding temperatures in much of the East. The result was price drops across the board Wednesday.

With Tropical Storm Hanna sliding up the East Coast and Hurricane Ike roaring out of the Atlantic, the Colorado State University (CSU) hurricane team said last Tuesday it expects five named storms, including four hurricanes, two of them intense (Category Three or greater), to form this month.

With some of Friday’s downward momentum sliding over into the new week, July natural gas futures bounced between a $7.560 low and a $7.705 high before closing out Monday’s regular trading session at $7.608, down 5.5 cents from last week’s close on Friday. While the bears were still having their way, most industry veterans are expecting yet another rebound off support in keeping with the market’s routine of the last several months.

The slope for sliding prices got considerably steeper in nearly all of the market Thursday, although a few western points managed to hang tough with flat performances. The factors of mild weather pervading much of the East, prior-day futures weakness, lack of tropical storm threats to offshore production and realized expectations of a bearish storage report all contributed to the overall softening.

Though natural gas prices have been sliding in the last few months, plans to construct an Alaskan natural gas pipeline into Canada and the Lower 48 are moving to the fast track, as producers and business groups, eager to move the process forward, push their proposals this month during a two-day hearing in Anchorage.

“The market is tanking. That pretty well sums it all up in anutshell,” was how a Gulf Coast marketer characterized the pricesituation Wednesday. Only California, where a series of rollingblackouts began in the northern part of the state (see related story), failed to participate infurther price declines that were mostly between about a quarter and 50cents.