Traction

The lower house Assembly Utilities and Commerce Committee late Monday passed out two measures that are gaining traction before the California state legislature takes its month-long summer recess. They would create a liquefied natural gas (LNG) terminal siting process and increase the state’s renewable energy goal to 33% by 2020.

Although most points were softer Friday as expected, the market found enough traction from cooler weekend weather in key northern market areas to keep a majority of the losses fairly small, and a few flat to moderately higher prices found their way into the mix. Trading was for Sunday-Monday flows because of the weekend transition between months.

March natural gas futures finally got a little traction Tuesday, but not enough to break out of their recently formed $5.95-6.27 trading range. While the prompt month gained 8.2 cents on the session to settle at $6.175, market watchers still question what the next move will be.

Helped higher due in part to colder than normal temperatures and winter storms in the Northeast, February natural gas futures on Monday explored higher. After reaching a high at $6.51, the prompt month went on to settle at $6.476, good for a 23.6-cent increase on the day. Awaiting its turn as the prompt month, March futures also achieved a 25.3-cent increase on the session to settle at $6.516.

After plummeting to trade at $5.32 just prior to noon (EDT), September natural gas futures failed to find any traction and failed to bounce off the floor for the remainder of the trading session. The prompt month reached a low of $5.305 in afternoon trading before settling at $5.31, down 24.2 cents from Friday’s close.

After dwelling in the mid $5.70s for most of the day, May futures were able to find some traction in afternoon trading, climbing up to a $5.83 high before settling at $5.809, up half a cent from Monday’s close. The second consecutive negligible day of trading came as little surprise to market-watchers, who had noted that trading this week was expected to be light due to religious holidays and spring break vacations (see Daily GPI, April 6). Volume on the day was 34,541.