Markets

In keeping with a state law passed last year (SB 380), California regulators said Friday they will launch an 18- to 24-month investigation to determine whether to reduce or eliminate operations at Aliso Canyon, the state’s largest underground natural gas storage facility.

Natural gas imported from the United States fills most of the chapters in Mexico’s power generation story, but a good part of that book is also devoted to renewable energy.

Of all the market points followed by NGI, only two managed to trade in positive territory during next-day natural gas physical trading Monday. Near-term weather forecasts at major population centers were at or above normal, and next-day power markets offered little support for incremental purchases for next-say power generation.

The expiring February natural gas contract is set to open 7 cents lower Friday morning at $3.31 as forecast cold is expected to be less intense than previously thought. Overnight oil markets sagged.

A cold weather system that was sweeping across much of the United States helped launch February natural gas forwards markets up an average of 10 cents between Jan. 20 and 26, according to NGI’s Forward Look.

Weekend and Monday natural gas prices fell in trading Friday as hefty gains in the Northeast were unable to offset much broader weakness across the country.

Physical natural gas bulls and bears went at each other only sparingly for the week ended Jan. 27, and most points advanced but only by a few pennies.

February natural gas is set to open 12 cents higher Thursday morning at $3.45 as traders discount expected government data showing low usage and focus on upcoming forecast weather patterns. Overnight oil markets were narrowly mixed.

Natural gas futures added to initial opening strength Thursday morning after the Energy Information Administration (EIA) reported a storage withdrawal that was about in line with what the market was expecting.