Dow Jones - End of Day Natural Gas Commentary

DJ Natural Gas Futures Pushed Lower by Abundant Supplies


   By Timothy Puko


  NEW YORK--Natural-gas prices closed lower Friday as traders focused on the
healthy supply overwhelming the market.

  The front-month September contract settled down 4.9 cents, or 1.3%, to $3.84
a million British thermal units on the New York Mercantile Exchange. The price
is in the middle of a 30-cent trading range that gas has stayed in for more
than a month.

  "Fridays typically reflect prices for the weekend, which is typically lower
from lower usage," Tom Saal, a broker at INTL FCStone Latin America in Miami,
said. "So I'm not surprised it kind of fizzled."

  Natural gas has been under pressure this summer as producers have kept up a
record pace at refilling stockpiles. The U.S. Energy Information Administration
said Thursday that another 88 billion cubic feet went into storage last week, a
record for the second week of August and 83% more than the five-year average
for that week.

  At a time of year when summer heat usually gets people to turn on air
conditioners and use gas-fired electricity, mild weather has helped producers
create large surpluses more commonly seen during the temperate spring and fall.
They have averaged 100-bcf additions to storage every week for nearly four
months. The EIA said they need just 90 bcf a week to adequately fill storage
for the winter.

  "The market is perhaps reassessing end-of-season stock levels," said Teri
Viswanath, a natural-gas strategist at BNP Paribas SA in New York. "We have
more than enough gas."

    FUTURES SETTLEMENT    NET     CHANGE
    Nymex September       $3.84   -4.9c
    Nymex October         $3.883  -4.7c
    Nymex November        $3.956  -4.5c

    CASH HUB              RANGE          PREVIOUS DAY
    El Paso Perm          $3.75-$3.89    $3.83-$3.86
    El Paso SJ            $3.79-$3.91    $3.85-$3.875
    Henry Hub             $3.83-$3.92    $3.86-$3.89
    Katy                  $3.91-$4.00    $3.91-$3.94
    SoCal                 $4.03-$4.16    $4.05-$4.34
    Tex East M3           $1.77-$2.15    $2.28-$2.38
    Transco 65            $3.875-$3.91   $3.86-$3.92
    Transco Z6            $1.80-$1.93    $2.33-$2.39
    Waha                  $3.79-$3.84    $3.83-$3.84


  Write to Timothy Puko at tim.puko@wsj.com


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  (END) Dow Jones Newswires

  August 22, 2014 15:09 ET (19:09 GMT)

  Copyright (c) 2014 Dow Jones & Company, Inc.

082214 19:09 -- GMT
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