Metal & Oil & Gas News – Nctv.net
Natural gas prices tumbled Wednesday as traders anticipate mild autumn weather to cut demand for air conditioning and gas-fired power.
The front-month October contract settled down 6.8 cents, or 2.5%, at $2.66 a million British thermal units on the New York Mercantile Exchange. In three sessions to start the week, gas spiked to a one-month intraday high and then fell all the way back to its lowest settlement since Sept. 9.
That rally that peaked Tuesday morning appeared to entice more traders into bearish bets, Jim Ritterbusch, president of energy-advisory firm Ritterbusch & Associates said in a note. Supply is still up 3 billion cubic feet a day from a year ago and the amount of gas in storage is likely to hit a record before the start of winter heating season, he said.
U.S. weather is also about to head into a mild period that makes demand weak for both gas heating and gas-fired power to run air conditioners. The above-average temperatures forecast to linger across the country through the end of the month are much less influential than above-average temperatures at the height of the summer.
“Even with a warming trend engulfing most of the U.S., the market is skeptical as to the longevity and the ultimate impact on Nat Gas demand…as fall quickly approaches,”Dominick Chirichella, analyst at the Energy Management Institute said in a note.
The U.S. Energy Information Administration is expected to report that storage levels grew by 72 billion cubic feet of gas during the week ended Sept. 11, according to the average forecast of 16 analysts and traders surveyed by The Wall Street Journal. The EIA is scheduled to release its storage data for the week on Thursday at 10:30 a.m. EDT.
WSJ
Zhejiang Yaang Pipe Industry Co., Limited (www.yaang.com)
