DJ Natural Gas Hits One-Month High Before Momentum Fades
By Timothy Puko
Natural gas hit a one-month intraday high Tuesday before strong supply pushed prices into retreat.
Small production declines combined with expectations for strong demand because of warm weather have helped buoy the market. However, production is still at a near-record pace, and many expect producers can ramp up quickly, preventingany extended rally, analysts said.
The front-month October contract settled down 3 cents, or 1.1%, at $2.728 a million British thermal units on the New
York Mercantile Exchange on Friday. It rose as high as $2.794/mmBtu, the highest intraday price since Aug. 14.
The few signs of falling production aren't ultimately enough to rescue the market from its oversupply, Frank Clements, co-owner of Meridian Energy Brokers Inc. outside New York, said in a note. He told clients to sell at prices above $2.80/mmBtu.
The U.S. Energy Information Administration on Monday said total gas production from the shale-drilling regions fueling the country's oil-and-gas boom is likely to fall by 200 million cubic feet a day from September to October. It is another sign that low prices are likely to cause production--while going at a near-record pace--to fall shy of some expectations.
"We don't have overwhelming supply. If we get a challenge with weather, I think we're going to get a bounce" in prices, said Phil Flynn, senior market analyst at the Price Futures Group in Chicago.
Natural gas consumption rises in hot temperatures, as consumers use gas-powered electricity for air conditioning. The weather in the next two weeks shows above-average temperatures lingering over nearly the entire country though the end of September.
FUTURES SETTLEMENT NET CHANGE
Nymex October $2.728 -3c
Nymex November $2.80 -2.8c
Nymex December $2.951 -2c
CASH HUB RANGE PREVIOUS SESSION
El Paso Perm $2.59-$2.635 $2.56-$2.60
El Paso SJ $2.6025-$2.645 $2.575-$2.62
Henry Hub $2.70-$2.75 $2.67-$2.715
Katy $2.64-$2.685 $2.65-$2.69
SoCal $2.77-$2.80 $2.72-$2.79
Tex East M3 $1.32-$1.45 $1.31-$1.425
Transco 65 $2.6725-$2.70 $2.64-$2.675
Transco Z6 $2.35-$2.65 $1.95-$2.30
Waha $2.59-$2.625 $2.56-$2.595
Write to Timothy Puko at tim.puko@wsj.com
-30-
Original Email Message: http://10.13.38.85/enewsmails/Links.aspx?Ac=6&ID=20150915-15271561-0
(MORE TO FOLLOW) Dow Jones Newswires
September 15, 2015 15:33 ET (19:33 GMT)
Copyright (c) 2015 Dow Jones & Company, Inc.
091515 19:33 -- GMT
------
No comments:
Post a Comment