DJ Natural-Gas Prices Close Higher
By Timothy Puko
NEW YORK--Natural-gas prices closed higher Tuesday on optimism that
forecasts of heat will push up demand.
The front-month September contract settled up 8.5 cents, or 2.2%, to
$3.877 a million British thermal units on the New York Mercantile Exchange. The
contract bounced off a nearly nine-month intraday low on Monday and has now
returned to the middle of its 23-cent trading range from the past month.
Several forecasts grew notably warmer Tuesday. Heat causes people to turn
on air conditioners and use more of the gas-fired electricity that powers them.
There have also been recent signs that power plants are using a higher
proportion of gas, relative to coal, as gas prices have hit their lowest points
of the year.
That is providing a support for prices and optimism that demand will get
an extra bump as the heat settles in, Aaron Calder, senior market analyst at
energy-consulting firm Gelber & Associates in Houston said in a note. The
weather models also show signs that heat and power demand could linger in the
most populated areas, as the patterns bringing heat into the south and east is
that kind that could block any emerging cold fronts from spreading from the
north, he said.
"Perhaps there's a temporary bottom," said Anthony Lerner, senior vice
president of industrial commodities at brokerage R.J. O'Brien in New York. "I'm
not predicting any kind of big rally. But prices should bounce around within
this range for at least a while."
Write to Timothy Puko at tim.puko@wsj.com
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(END) Dow Jones Newswires
August 19, 2014 15:11 ET (19:11 GMT)
Copyright (c) 2014 Dow Jones & Company, Inc.
081914 19:11 -- GMT
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