DJ Natural Gas Inches Higher on Expiration Day
By Timothy Puko
Natural gas prices inched higher Tuesday as the front-month contract heads toward expiration, pushing a rebound amid
a raft of bearish bets.
Bets on falling prices have been outnumbering bets on rising prices by more than three-to-two in recent weeks, a
scenario that can cause a rally on expiration day. Many of those bears will have to close out their bets or roll them
over to the next month, and to do it they have to buy back into a contract they once sold, according to BNP Paribas SA.
"Expiration can be tricky," said Scott Gettleman, an independent trader in New York.
Prices for the front-month May contract gained 0.3 cent, or 0.1%, to $2.493 a million British thermal units on the
New York Mercantile Exchange. The June contract is now more heavily traded, with May's expiring at the end of Tuesday's
trading. May options expired on Monday. The June contract gained 0.8 cent, or 0.3%, to $2.522/mmBtu.
Mild weather and healthy supply are likely to limit any rally, though, analysts said. At a time of near-record
production, spring weather forecasts also look comfortable nationwide, capping demand for energy to heat or cool homes.
That is likely to lead to large weekly surpluses that keep June futures stalled below $2.55/mmBtu, said Jim
Ritterbusch, president of energy-advisory firm Ritterbusch & Associates.
Physical gas for next-day delivery at the Henry Hub in Louisiana last traded at $2.54/mmBtu, compared with Monday's
range of $2.4625-$2.495. Cash prices at the Transco Z6 hub in New last traded at $2.40/mmBtu, compared with Monday's
range of $2.45 to $2.53.
Write to Timothy Puko at tim.puko@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwireshttp://online.wsj.com?mod=djnwires">http://online.wsj.com?mod=djnwires
>
(END) Dow Jones Newswires
April 28, 2015 09:08 ET (13:08 GMT)
Copyright (c) 2015 Dow Jones & Company, Inc.
No comments:
Post a Comment