Markets

Fueled by the coldest air yet this heating season and cajoled by supportive futures prices, cash prices in the Northeast continued their meteoric rise Wednesday, stair-stepping higher in dollar increments as traders scrambled for molecules amid heavy heating demand. Meanwhile, temperatures across the rest of the nation moderated, albeit slightly, from last week’s frigid cold, and prices eased accordingly. In futures trading, January tacked on an even dime to close Wednesday at $4.337 and February followed suit to settle at $4.331. January crude oil dropped $1.07 to $97.44/bbl.

January natural gas is expected to open 5 cents higher Tuesday morning at $4.28 as traders focus on the demand side of the equation and weather forecasts continue to call for bone-chilling cold. Overnight oil markets rose.

In a series of separate votes Tuesday, five federal agencies — the Board of Governors of the Federal Reserve System, Commodity Futures Trading Commission (CFTC), Federal Deposit Insurance Corp., Office of the Comptroller of the Currency and the Securities and Exchange Commission (SEC) — all issued final rules developed jointly to implement the Volcker Rule, which limits risk-taking by banks with federally insured deposits.

Physical natural gas for delivery Wednesday retreated around a dime on average with declines in the Midcontinent, Rockies and California more than offsetting gains at eastern points.

January natural gas is expected to open 7 cents higher Monday morning at $4.19 as traders turn their attention to forecasts calling for cold weather to impact Northeast and eastern markets. Overnight oil markets eased.

The total volume of pipeline capacity traded by the top 20 gas pipeline capacity trading players was up 106% this year over 2012 volumes, surpassing 15.8 Bcf/d, according to Skipping Stone’s Capacity Center. It marks the fourth consecutive annual increase in the volume of capacity traded, according to the firm.

Physical natural gas for delivery Tuesday soared 66 cents on average in trading Monday as the Arctic chill continued. Blizzard-like weather maintained a stranglehold on key eastern and Midwest energy markets.

The governors of six New England states have committed to work together with the Independent System Operator of New England (ISO New England) to advance an energy infrastructure initiative that diversifies the region’s energy supply portfolio while ensuring that the benefits and costs of transmission and pipeline investments “are shared appropriately” among the states.

Physical natural gas prices for weekend and Monday delivery on average vaulted another 62 cents in Friday’s trading. Gains were made at all but a couple of Marcellus points and were deep into double digits.