Markets

U.S. industrial demand for natural gas has failed to match expectations and lags far behind supply growth, an odious sign for natural gas prices going forward, according to Raymond James & Associates Inc.

Physical natural gas for Tuesday delivery gained ground in Monday’s trading, barely outpacing a lackluster performance on the screen.

March natural gas is expected to open 2 cents lower Monday morning at $1.78 as traders see falling demand prompting still lower prices for March. Overnight oil markets rallied.

While leadership has shifted to the California Public Utilities Commission (CPUC) in overseeing an independent investigation of the root causes in the four-month-old natural gas storage well leak in Southern California, the future of the 86 Bcf, 3,600-acre underground storage field is shrouded in doubt and dissention.

March natural gas is set to open 2 cents lower Friday morning at $1.83 as weather forecasts continue the trend of moderation with little in the way of market-moving developments on the horizon. Overnight oil markets fell.

When we mentioned during the second week of February that it would take either significant heating demand or bullish storage news to end the slide natural gas prices have been on, we were wrong.

After pivoting to east-to-west flows to accommodate the mighty Marcellus and Utica shales, the Rockies Express Pipeline (REX) has been a major outlet for Appalachian Basin gas to reach Midwest delivery points.

Both physical natural gas for weekend and Monday delivery and futures fell in Friday’s trading. Physical traders saw no reason to commit to three-day deals with mild weekend temperatures expected and abundant storage.

March natural gas is expected to open 5 cents lower Thursday morning at $1.89 as traders note moderating weather forecasts and the looming end of the withdrawal season. Overnight oil markets gained.