Dow Jones Natural Gas - Market Slides As Market Looks Beyond Blizzard

DJ Natural Gas Slides as Market Looks Beyond Blizzard


   By Christian Berthelsen


  Natural gas prices fell more than 3% on Monday despite the onset of a massive northeastern blizzard, as traders
looked ahead to February weather that is now expected to be warmer than previously predicted.

  Natural gas for February delivery ended the day down 10.5 cents, or 3.5%, at $2.881 a million British thermal units
on the New York Mercantile Exchange. The market has lost ground in five of the last seven sessions and is off more than
10% in the last two weeks.

  Prices have fallen as inconsistent weather forecasts and robust domestic production have combined to ensure weak
gas-fired heating demand and adequate supplies. Even as the storm that hit the Northeast on Monday was expected to dump
as much as three feet of snow, the forecasts into early February turned warmer than previously expected, particularly
in key consuming areas such as the Midwest, damping demand expectations.

  "We don't have a lot of buying appetite because we have full supplies at the end of January, and what we see
occurring ahead is a continuing pattern of variability," said Teri Viswanath, a natural gas market strategist at BNP
Paribas. "What we need to shore up gas prices is a persistent cold outlook."

  Temperatures have been solidly cold so far this winter, but robust domestic gas production has helped the U.S.
recover from extraordinary supply drawdowns brought on by last year's brutal winter. There were 2.6 trillion cubic feet
of natural gas in storage according to official U.S. data last week, 8.2% above year-ago levels but 5.5% below average
for this time of year. Analysts are looking toward the end of the winter heating season to see if inventories will be
adequately used up, since a strong production season in the spring and summer is expected to result in a large addition
to supplies.

  "A serious shortage is not likely," research consultancy Gelber & Associates said in a note.

FUTURES          SETTLEMENT   NET CHANGE
Nymex February     $2.881       -10.5c
Nymex March        $2.848       -11.0c
Nymex April        $2.836        -8.7c

CASH HUB         RANGE            PREVIOUS SESSION
El Paso Perm  $2.63-$2.66           $2.75-$2.77
El Paso SJ    $2.64-$2.66           $2.76-$2.77
Henry Hub    $2.915-$2.935          $2.90-$2.955
Katy          $2.77-$2.82           $2.82-$2.85
SoCal         $2.75-$2.82           $2.79-$2.87
Tex East M3   $6.30-$8.00          $2.695-$2.92
Transco 65    $2.89-$2.95           $2.84-$2.93
Transco Z6   $11.75-$13.25          $3.23-$3.28
Waha          $2.68-$2.72           $2.74-$2.785


  Write to Christian Berthelsen at christian.berthelsen@wsj.com


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  (END) Dow Jones Newswires

  January 26, 2015 15:47 ET (20:47 GMT)

  Copyright (c) 2015 Dow Jones & Company, Inc.

012615 20:47 -- GMT
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