Prices spiked by 30-70 cents or so Tuesday even as some traders found it hard to rationalize the market’s strength. They could identify chilly weather in some regions, especially in much of the West, and even noted that much of Texas is hot enough to experience decent air conditioning load.
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Swing Price Increases Continue and Get Larger
It was a wild ride Wednesday in swing trading for the last day of September. All points spiked by amounts ranging from about 30 cents to nearly a dollar, with a heavy majority up 60 cents or more, in a market driven largely by a screen that soared nearly half a dollar Tuesday and was up by almost 90 cents at one point Wednesday morning before retreating in sympathy with falling oil futures.
Sen. Lieberman Seeks Gas Price Investigation
Seeking answers for why natural gas prices have spiked so high this winter, Sen. Joe Lieberman (D-CT) concluded 2003 by asking the Commodity Futures Trading Commission (CFTC) and the Federal Energy Regulatory Commission (FERC) to launch an investigation.
Futures Rally, then Retrace on Weather, Storage Forecasts
In concert with a one-two combination of bullish private and governmental weather forecasts, the natural gas futures market spiked briefly above the $7.50 mark Wednesday as non-commercial fund traders reversed to the long side of the market. As it turned out, that may have been an expensive decision because prices tumbled Wednesday afternoon nearly as quickly as they had risen.
NYC Spikes Lead Overall Advance; Rockies Softer
Most Northeast citygates spiked by half a dollar or more Monday, led by a whopping dollar-plus gain to more than $6 in the Transco Zone 6-New York City pool, as sub-freezing temperatures reigned or approached across the northern tier of states as far west as the Rockies.
Contrarian’s Rule as Futures Spike on Bearish Storage
Despite the release of a storage report featuring a larger-than-expected 48 Bcf injection, natural gas futures spiked to new 16-month highs Thursday morning amid a frenzy of buying from all market segments — funds, locals and commercials. Modest profit-taking trimmed gains in the afternoon, but the was unable to erase bulls’ work. At $4.299, November finished 7.2 cents higher for the session.
PJM Finds No Violation of Market Rules in Import Activity
A power trading practice detected last month by PJM Interconnection that spiked power prices and sent loop flows higher by more than 3,000 MW, did not violate the grid operator’s market rules, and instead was the result of flawed incentives for market participants who were attempting to maximize the price they received for power, the head of PJM’s market monitoring unit (MMU) said last Tuesday.
EIA Reports 33 Bcf Injection, Revises Data; September Rises 8.5 Cents
September natural gas futures spiked all the way up to $2.80 from $2.67 in about five minutes Thursday morning after the Energy Information Administration (EIA) reported a 33 Bcf storage injection, which was well below most expectations (centered on 45-50 Bcf). EIA also issued a downward revision for its data from the previous week. Despite the bullish news, however, the September contract managed only an 8.5-cent gain for the day and closed at Tuesday’s high of $2.745, leaving some observers unconvinced that the downtrend is over. October gained 8 cents, ending the day at $2.784 and the winter strip rose 5.7 cents to $3.46.
PJM Probing Power Import Move that Spiked Loop Flows, Prices
PJM Interconnection’s market monitoring unit (MMU) is taking a closer look at a series of events that took place earlier this month involving a power trading practice that churned loop flows higher by more than 3,000 MW and increased prices after a gulf emerged between contract and actual power flows at the grid operator’s interfaces with American Electric Power (AEP) and Dominion Virginia Power.
Futures Fall in Convergence with Relatively Weak Cash
Buoyed by heavy market-on-close buying, natural gas futures spiked higher at the closing bell, but that only served to trim losses suffered earlier in the trading session. The December contract finished at $2.606, down 9 cents for the session. Meanwhile, the January contract closed with a 1.6-cent gain at $2.951, proving that traders have not yet given up on the winter. Estimated volume of 120,569 was heavy, even considering it was December’s penultimate trading day.