Spike

With Monday’s 78.5-cent futures spike (and a further sizeable screen increase early Tuesday) giving added impetus to the cash market’s reawakened bullishness based on new forecasts of widespread cold weather later in the week, spot gas quotes realized even larger gains Tuesday than they had the day before in most cases.

Tuesday’s late expiration-day spike of September futures had limited success in rallying the cash market Thursday. It struggled against the negative influences of generally moderate late-August weather throughout the northern U.S. and Canada, the lack of any new tropical storm activity and the prospects that Tropical Depression Ernesto will be dampening potential power generation load along the East Coast.

With midweek heat staying fairly strong in nearly all areas — especially the West — and with extra support from a prior-day screen spike of nearly half a dollar, cash quotes again rose by sizeable double-digit amounts at all points Tuesday.

With strong ancillary support from a half dollar-plus spike in futures the day before, cash prices found heating load remaining strong enough Tuesday to record increases at virtually all points. A new record-setting screen gain of a little more than half a dollar Tuesday and little let-up in wintry weather due across most of the U.S. and Canada make it likely that physical market gains will continue Wednesday.

Addressing the recent spike in natural gas futures prices, Jon M. Huntsman, the founder and chairman of Huntsman Corp. said traders on the New York Mercantile Exchange (Nymex) are responsible for forcing the price of natural gas to all time highs, which is severely hurting every U.S. natural gas consumer.

The spike in natural gas futures prices to record levels Thursday can be directly attributed to the fact that major energy markets are experiencing their first real winter storm of the season with sustained cold, according to Sandy “Trot” Goldfarb, one of the largest natural gas local traders.

Riding the support of both cold weather demand and a prior-day futures spike of more than a dollar, natural gas cash prices were up strongly again Wednesday across the board. Gains ranged from a little less than a dime to nearly $1.10. A large majority of the increases were at least 40 cents or more.

Prices rose across the board Tuesday based on a screen spike of nearly 33 cents the day before and still substantive (but dwindling) air conditioning load. Upticks ranging from nearly a dime to a little more than 40 cents were distributed fairly evenly among the various market regions, although California quotes tended to see the smallest increases.

Buoyed by Tuesday’s expiration-day screen spike of 32.4 cents and almost nothing else, prices for end-of-March flows saw substantial gains Wednesday. Increases were fairly consistent and spread evenly through all market areas in ranging from a little less than 20 cents to nearly 35 cents in nearly all cases (the exception was a rise of a little more than a dime by OGT in the Midcontinent).