Dow Jones - Morning Natural Gas Commentary

DJ Natural Gas Weakens as Weather Outlook Warms


   By Nicole Friedman


  NEW YORK--Natural-gas slipped to an 11-month intraday low Tuesday on expectations that warm weather this month would
keep demand for the heating fuel muted.

  Natural gas for November delivery recently fell 0.4 cent, or 0.1%, to $3.666 a million British thermal units on the
New York Mercantile Exchange, the lowest intraday level since Nov. 20, 2013.

  Weather forecasts for the next two weeks are predicting above-normal temperatures across the Central and Eastern U.S.

  "A burst of warming into the Midwest and East late this weekend into the first half of next week looks a bit stronger
again today," said forecaster Commodity Weather Group LLC in a note Tuesday.

  Cold temperatures boost demand for natural gas, which half of all American households use as a primary heating fuel.
Prices are down for a sixth straight day on signs that warmer weather could limit natural-gas usage this month.

  However, traders are still waiting to see how cold the winter will be. Last winter, sustained lower-than-average
temperatures prompted record-high demand for natural gas.

  "We don't expect a price decline of more than eight-to-nine cents from yesterday's settlement through the rest of
this week unless mild [forecasts] are extended through the first week of November," said energy-advisory firm
Ritterbusch & Associates in a note.

  Natural gas for next-day delivery at the benchmark Henry Hub in Louisiana recently traded at $3.61/mmBtu, according
to Intercontinental Exchange Inc., versus Monday's average of $3.6810/mmBtu.

  Natural gas for next-day delivery at Transcontinental Zone 6 in New York traded between $2.20 and $2.40/mmBtu,
compared with $2.3688/mmBtu Monday.


  Write to Nicole Friedman at nicole.friedman@wsj.com


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  (END) Dow Jones Newswires

  October 21, 2014 09:15 ET (13:15 GMT)

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

102114 13:15 -- GMT
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