DJ Natural Gas Futures Rising on Early Winter Demand
By Timothy Puko
NEW YORK--Natural gas futures are rising for the fourth time in five sessions as analysts expect heating demand is
already hitting levels common for mid-winter.
Natural gas for December delivery rose 3.6 cents, or 0.8%, to $4.407 a million British thermal units on the New York
Mercantile Exchange. Prices are now up nearly 11% from the month's low closing price set a week ago.
The cold snap that started last week is likely lead to the first storage withdrawal of the year, according to the
Wall Street Journal's weekly survey of analysts and brokers. They expect that stockpiles shrunk by 11 billion cubic
feet for the week that ended Nov. 14, about on par with the five-year average for the week, a 10-bcf withdrawal. The
U.S. Energy Information Administration plans to announce the official numbers at 10:30 a.m.
But it may be the following week's demand that keeps pushing up the market, analysts said. Some are already
predicting a second withdrawal larger than 150 bcf. That is more akin to a week at the peak of winter cold in January
than for mid-November, Teri Viswanath, a natural-gas strategist at BNP Paribas SA in New York, said in a note.
"The market is much more focused on large supply declines that will be forthcoming next week," Jim Ritterbusch,
president of energy-advisory firm Ritterbusch & Associates, said in a note. Prices aren't likely to fall back until
temperatures return to normal, he added.
But normal temperatures are barely visible in the newest weather forecasts for the next two weeks. Weather Services
International in Andover, Mass., said a cold air mass could "engulf the eastern two-thirds of the nation" in the first
week of December. It is forecasting highs between the upper teens and 30s for the northern Plains, the Midwest and
parts of the Northeast.
Physical gas for next-day delivery at the Henry Hub in Louisiana last traded at $4.40/mmBtu, compared with
Wednesday's range of $4.35-$4.55. Cash prices at the Transco Z6 hub in New York traded in a bid-ask range of
$4.65-$5.95/mmBtu, compared with Wednesday's range of $4.70 to $5.00.
Write to Timothy Puko at tim.puko@wsj.com
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(END) Dow Jones Newswires
November 20, 2014 09:19 ET (14:19 GMT)
Copyright (c) 2014 Dow Jones & Company, Inc.
112014 14:19 -- GMT
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