Markets

Just as Monday physical natural gas trading saw a near-40 cent rise in Tuesday deliveries, Wednesday packages took just over a 30-cent hit as a trifecta of moderating temperatures, soft next-day power pricing and decreasing forecast power loads made incremental purchases of next-day gas unattractive.

Natural gas forwards were up by the double-digits for the period between Dec. 24 and 30 as more sustained cold weather finally arrived, dropping temperatures, bolstering demand and causing freeze-offs in parts of the country.

U.S. natural gas prices look terrible again this year and could decline another 25% from 2015 as the structural oversupply continues, Raymond James & Associates Inc. said Monday.

Physical natural gas prices bounded higher on Monday for Tuesday trading as temperature outlooks in major eastern and Midwest population centers either held seasonal norms, or in the near term were forecast to drop below normal by, in some instances, double-digits.

February natural gas is set to open 4 cents lower Monday morning at $2.30 as traders tweak forecasts to accommodate a lower level of near-term heating demand. Overnight oil markets rose.

February natural gas is expected to open 15 cents higher Thursday morning at $2.36 as traders factor in additional cooling and a high-risk storage report. Overnight oil markets were mixed.

Natural gas futures were unable to improve upon a sharply higher open Thursday morning after the Energy Information Administration (EIA) reported a storage withdrawal that was about in line with what traders were expecting.

Physical natural gas for delivery over the extended holiday period gained ground in Thursday’s trading as losses at California and Rocky Mountain points were easily offset by gains in the Gulf, Midcontinent and Northeast.

February natural gas is set to open 4 cents lower Wednesday morning at $2.33 as traders consolidate positions following two days of double-digit advances and also assess the longer-term supply outlook. Overnight oil markets retreated.