Dow Jones - Morning Natural Gas Commentary

DJ Natural Gas Rally Slows on Weakening Demand Expectations


   By Timothy Puko


  NEW YORK--The natural-gas market's week-long rally slowed Tuesday morning as weakening demand expectations encouraged
traders to hold steady.

  Natural gas for November delivery inched up 0.4 cent, or 0.1%, at $4.158 a million British thermal units on the New
York Mercantile Exchange. The move adds to a two-month high the market set Monday, with Tuesday's prices peaking at
$4.178/mmBtu, the highest intraday price since July 10.

  Prices pulled back slightly after weather forecasts showed warmer expectations than they had the day before. Cool
temperatures and fears of an early winter had some traders thinking that demand for home heating should drive prices
higher.

  Once prices broke $4 on Monday, momentum and technical trading kept pushing prices higher, traders and analysts said.
That has some thinking the market is inflated with record production still likely to overwhelm demand, capping the
rally and keeping prices within a 7-cent range on Tuesday.

  "I still think we're going lower...but you can't get in the way right now," said Scott Gettleman, an independent
trader in New York.

  Physical gas for next-day delivery at the Henry Hub in Louisiana last traded at $4.15/mmBtu, compared with Monday's
range of $4.00-$4.03. Cash prices at the Transco Z6 hub in New York traded in a bid-ask range of $2.05-$2.20/mmBtu,
compared with Monday's range of $2.04 to $2.08.


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


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  (END) Dow Jones Newswires

  September 30, 2014 09:27 ET (13:27 GMT)

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

093014 13:27 -- GMT
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