Dow Jones Natural Gas - End of Day Commentary

DJ Natural Gas Sinks on Warmer Weather



  By Nicole Friedman


  NEW YORK--Natural-gas prices dropped to a one-month low Monday on expectations that warmer weather would reduce
demand for the heating fuel.

  Futures gained 3.8% last week as frigid temperatures continued into the first week of March, following the coldest
February in about 30 years. About half of U.S. households use natural gas to heat their homes, so freezing weather
boosts natural-gas consumption.

  But temperatures warmed up over the weekend in the Northeast, which is a key natural-gas-consuming region.

  Front-month April futures settled down 16.1 cents, or 5.7%, at $2.678 a million British thermal units on the New York
Mercantile Exchange, the lowest settlement price since Feb. 10.

  Traders who had bet on higher prices closed out positions after weather forecasts released over the weekend called
for moderate temperatures, said Jim Ritterbusch, president of energy-advisory firm Ritterbusch & Associates.

  "After the mild updates that we saw over the weekend in the short-term temperature views, [which] go out all the way
into the beginning of spring now, we saw a lot of liquidation" of bets on higher prices, he said.

  Natural-gas inventories have fallen by large amounts in recent weeks because of strong consumption, but traders
expect those withdrawals to shrink in the coming weeks.

  "This week's emerging spring-like weather will usher in the end of the winter withdrawal season," said Teri
Viswanath, director of commodity strategy for natural gas at BNP Paribas SA, in a note. The withdrawal season typically
lasts from November to April.

  "Sustained natural-gas price recovery appears to be months away," Ms. Viswanath said.

FUTURES       SETTLEMENT        NET CHANGE
Nymex April   $2.678            -16.1c
Nymex May     $2.713            -15.9c
Nymex June    $2.750            -15.6c

CASH HUB        RANGE                           PREVIOUS SESSION
El Paso Perm    $2.295-$2.45                    $2.44-$2.60
El Paso SJ      $2.375-$2.42                    $2.435-$2.52
Henry Hub       $2.68-$2.75                     $2.845-$2.95
Katy            $2.60-$2.73                     $2.74-$2.88
SoCal           $2.47-$2.55                     $2.55-$2.62
Tex East M3     $1.57-$2.05                     $2.40-$3.05
Transco 65      $2.61-$2.68                     $2.80-$2.96
Transco Z6      $2.58-$2.72                     $2.96-$3.75
Waha            $2.53-$2.60                     $2.65-$2.7275


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


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  (END) Dow Jones Newswires

  March 09, 2015 15:01 ET (19:01 GMT)

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

030915 19:01 -- GMT
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