Softer

Many traders likely thought the previous swing price record of $69/MMBtu, set at the Southern California border on Dec. 11, 2000 (see Daily GPI, Dec. 12, 2000), would never be challenged. But the Northeast, starting to resemble a giant cryogenics laboratory, bested that handily Wednesday with a quote of $76 at Iroquois Zone 2.

Tuesday might have looked bearish from the previous day’s vantage point, but other than some moderate softening that clustered primarily in the West, all other points ranged from flat a little more than a dime higher in a near-repeat of Monday trading. A majority of Tuesday’s gains were around a nickel or smaller.

Wednesday’s swing market was almost a mirror image of the previous day. This time single-digit declines dominated the price table instead of the increases by largely similar amounts recorded on Tuesday. One trader said the mild softness on Wednesday is what he actually had expected for both days.

Most of the cash market was softer as expected Thursday, but forecasts of warm to hot weather in much of the U.S. outside the West Coast over the Fourth of July weekend and late run-ups following release of the storage report allowed a few scattered points to record flat to mildly higher numbers. The losses tended to range from just under a nickel to about 35 cents, with a majority at 15 cents or less.

A long weekend following a bearish storage report and related screen dip, along with benign weather scenarios in nearly all markets, had the predictable effect on cash numbers Friday: double-digit declines in nearly all cases. Although a few scattered points contained their losses to a little less than a dime, a large majority fell 15 cents or more, led by plunges of 30 cents-plus in the Rockies/Pacific Northwest and nearly a dollar in the San Juan Basin.

Softer cash prices ahead of the weekend and forecasts suggesting there will be little additional weather-related demand this week were enough Friday to put the kibosh on any chance for a short-covering rally in natural gas futures. With that the May contract completed its penultimate trading day in an exceedingly lackluster session that featured a razor thin 4-cent trading range. It closed at $5.477, up 0.3 cents from Thursday’s close.

Finding little of significance in new price influences upon emerging from the Easter weekend, virtually all of the cash market was content to mark time Monday. Outside of declines ranging to nearly a quarter in the Rockies, most other points stayed within about a nickel up or down from flat. There was a slight bias to the upside.

Building on Thursday’s screen spike, forecasts of severe weather over the weekend across much of the Midwest and Northeast, and anticipation of even greater heating load to arrive later this week, cash prices made another strong surge Friday. Double-digit gains were the order of the day for a majority of points; however, Rockies quotes retreated between about a dime and a quarter.

The post-Christmas cash market saw a mix of price movement that was largely weighted toward moderate declines. A few small upticks were scattered here and there, but a majority of points ranged from flat to down a little more than 20 cents (Northwest-Sumas).