DJ Natural Gas Futures Rebound on Winter Chill
By Timothy Puko
Natural gas futures rebounded Wednesday as cooling forecasts pushed another big day of gains.
Natural gas for December delivery rose 15.4 cents, or 3.6%, to $4.398 a million British thermal units on the New York
Mercantile Exchange. After a small dip yesterday, prices are again pushing toward a five-month high. Big gains Monday
and Wednesday have gas up 9.6% for the week so far, as cold weather forecasts drive expectations for heavy demand for
the heating fuel.
Forecasts for winter cold have repeatedly boosted prices since late October. Many traders are still thinking about
historic cold and record demand from last winter that sent prices soaring above $6/mmBtu and now they're jumping on any
sign a repeat could be on the way.
Wednesday's morning weather updates, though mixed, did show that the start of December is likely to be slightly
colder than expected yesterday. Temperatures two-to-five-degrees below normal are likely to spread further into the
west than expected, including the high-demand Chicago market, MDA Weather Services said.
"You get a news story that comes in that says we're going to freeze ... and it sends it through the roof," said John
Woods, president of JJ Woods Associates and a Nymex floor trader.
The short-term burst of cold this week isn't likely to last as long as expected, but it's still influencing traders,
analysts said.
"It may not officially be winter yet but it certainly feels like the heart of winter in many parts of the U.S.,"
Dominick Chirichella, analyst at the Energy Management Institute, said in a note.
Physical gas for next-day delivery at the Henry Hub in Louisiana last traded at $4.43/mmBtu, compared with Tuesday's
range of $4.2925-$4.34. Cash prices at the Transco Z6 hub in New York traded in a bid-ask range of $5.00-$5.50/mmBtu,
with Tuesday's range of $5.25 to $7.00.
Write to Timothy Puko at tim.puko@wsj.com
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(END) Dow Jones Newswires
November 19, 2014 09:45 ET (14:45 GMT)
Copyright (c) 2014 Dow Jones & Company, Inc.
111914 14:45 -- GMT
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