Traders

Canadian producers and international traders are lining up to support the aboriginal entry into plans for liquefied natural gas (LNG) export terminals on the Pacific coast of northern British Columbia (BC), the National Energy Board (NEB) has been told.

June natural gas futures continued to drop Friday as traders now see the market at a level more prone to reflect value but still poised to move lower in the near term. At the close June had weakened 2.6 cents to $4.235 and July had dropped 3.4 cents to $4.297. June crude oil continued its descent, losing $2.62 to $97.18/bbl.

Spot prices saved their best for last — at least in the viewpoint of bullish traders — by making the strongest gains of last week virtually across the board on Friday. A large futures uptick a day earlier combined with increasing weather-based load in some areas to support the physical market.

It failed to surprise any traders when prices fell at all but one point Friday. Despite cooling trends in the Midwest and South, moderation dominated the general weather outlook; the latest storage withdrawal report reinforced the perception of plentiful inventories (especially when the Producing region had an unusually early net injection); prompt-month futures had fallen 4 cents on the previous day; and the decline of industrial load during a weekend was a minor bearish factor as usual.

With traders not interested in making waves ahead of fresh inventory news Thursday, natural gas futures action was fairly quiet on Wednesday as the February contract traveled a slim range of just more than a dime before closing the regular session at $4.531, up a nickel from Tuesday’s finish.

February natural gas futures declined by a few more pennies on Monday as traders — after a week of fluctuating forecasts — were still attempting to get a better handle on what the weather picture will be like in the coming weeks. The prompt-month contract traded between $4.322 and $4.450 before closing the regular session at $4.399, down 2.3 cents from last week.

Natural gas futures traders continued to probe the downside on Wednesday but had significantly reined in the bearish enthusiasm that was prevalent on Tuesday. January futures reached a low of $4.193 before closing the regular session at $4.222, down 3.3 cents from Tuesday’s regular session close.

December natural gas futures managed a small gain Monday as some traders attributed favorable weather forecasts to giving the market a modest lift. December futures rose 4.6 cents to $3.845 and January also added 4.6 cents to settle at $4.028. December crude oil eased 2 cents to $84.86/bbl.

Next-day forecasts still relatively moderate, but traders see heating load increases nearby.