NATURAL GAS SCENARIO / Focus On North America - Part 1
NYMEX gas mostly ends lower, ACCESS gains on AGAs
NEW YORK, Nov 18- NYMEX Hub natgas futures, hit by more technical
selling and bearish weather forecasts, mostly ended lower Wednesday in active trade, then briefly moved up on ACCESS after a slightly bullish weekly inventory report.
In the day session, December skidded 7.5 cents to close at $2.204 per million British thermal units after trading between b$2.185 and $2.304. On ACCESS, Dec traded up to $2.22 shortly after the AGA data, but quickly slipped back to $2.195 and then $2.165 amid confusion about revisions in the report.
Earlier, January settled eight cents lower at $2.326, while most other deferreds ended flat to down 6.7 cents.
''The number was a little supportive, but the draw was not great enough to prompt a big rally. Length is still on the defensive - there's no (cold) weather and stocks are still growing (versus year-ago),'' said one Midwest trader.
AGA, which revised its estimated full working gas capacity and previous week's regional numbers tonight, said U.S. gas stocks fell last week by 45 bcf, above Reuter poll estimates in the 30-40 bcf range.
Overall storage stands at 3.082 trillion cubic feet, or 95 percent of capacity.
Most traders agreed underlying sentiment remained bearish ahead of the December expiration and bidweek next week, with storage well above last year and more mild weather expected.
In addition, traders noted typically-soft industrial and commercial demand during the Thanksgiving holiday week.
WSC expects slightly below normal Northeast and Mid-Atlantic temperatures Wednesday to warm to normal or several degrees F above normal Thursday through Sunday. In Florida and the Southeast, above normal readings Wednesday and Thursday will cool to normal or below by the weekend.
After a brief cooldown Thursday and Friday in the Midwest, temperatures are expected to climb to two to eight degrees above normal Saturday and Sunday. In Texas, readings are expected to dip to slightly below normal Thursday, then warm to three to six degress above normal over the weekend. Normal to below normal Southwest temperatures Wednesday and Thursday will warm to two to six degrees above normal later in the period.
The NWS six- to 10-day forecast released late Wednesday calls for mostly normal temperatures along the East Coast, with above- to much-above normal readings forecast for the rest of the nation.
After December's break today of support at the November low of $2.24, next support was seen in the remaining continuation chart gap to $2.12. Major buying also was expected at the prominent low of $2.14 from September 2, with psychological support at $2.
Minor resistance was pegged at $2.39, with better selling likely at Wednesday's high of $2.51 and at the recently-formed double top at $2.63-2.64.
In the cash Wednesday, Henry Hub swing quotes slipped a penny to the $2.10-2.11 area. Midcon pipes lost three cents to the $2.05-2.10 level. In the West, El Paso Permian held steady at $2.06-2.09.
Swing gas at the Chicago city gate slipped slightly to $2.18-2.20, while New York was little changed at about $2.30.
The NYMEX 12-month Henry Hub strip slipped 2.9 cents to $2.223. NYMEX total estimated Hub volumes were not available at 1640 EST, but 72,179 lots had changed hands as of 1500 EST, up from Tuesday's revised tally of 69,791.
NYMEX December natgas expires Tuesday, November 24.
U.S. spot gas prices supported by brief cold spell
NEW YORK, Nov 18 - U.S. spot natural gas prices were little changed
Wednesday, supported briefly by the arrival of some cold air in the upper Midwest, industry sources said.
''There's just a little bit of a cold spell. Prices should tumble before the weekend though when this cold disappears,'' one Midwest trader said.
Cooler weather is forecast for much of the Midwest and Texas over the next couple of days, with lows in Chicago expected to reach the low-30s by Friday, according to Weather Services Corp.
However, warmer air is expected to return by the weekend, a trend which is forecast to continue through next week in most of the U.S.
Next-day cash prices at Henry Hub were quoted at $2.08-2.12 per mmBtu, down about one or two cents from Tuesday.
In the Midcontinent, swing prices slipped about three cents to $2.06-2.10, while Chicago city-gate gas sold at $2.19-2.20, sources said.
In west Texas, Permian Basin prices were mostly steady at $2.06-2.10, while the San Juan market saw similar deals at $2.06-2.09.
In the East, New York city-gate prices remained fairly firm in the high-$2.20s to low-$2.30s, sources said.
Withdrawal estimates for today's American Gas Association storage report ranged widely from five to 70 bcf, with most centering around 30-40 bcf. This compares with a 64 bcf withdrawal a year ago.
Canadian natural gas spot prices firm amid cold, low supply
CALGARY, Nov 18 - Canadian natural gas spot prices stayed strong on Wednesday amid continued cold weather and limited supply, industry sources said.
Temperatures had been well below zero to begin the week in Alberta, but warmed slightly on Wednesday to -1 Celcius (30 degrees Farenheit).
But warmer weather, which was originally forecast to arrive Friday, could put downward pressure on prices, marketers said.
Prices have also been bolstered by continued low field receipts, one Calgary-based marketer said.
Day prices at Alberta's AECO storage hub were up another seven cents, to C$2.83/2.88 per gigajoule, while the December contract traded at C$2.85 per GJ.
The December-March winter contract was quoted at C$2.88 per GJ.
At Westcoast Energy's Station 2 compressor in British Columbia, day business was discussed at C$2.83/2.88, up about eight cents from Tuesday.
Prices were also stronger at the Sumas/Huntingdon export point, rising four cents to US$2.00/2.05 per million British thermal units.
To the east, pricing at the Niagara export point was up slightly to US$2.30/2.35 per mmBtu.
MORNING UPDATE
NYMEX Hub natural gas called lower with softer cash
NEW YORK, Nov 19 - NYMEX Hub natural gas futures were expected to open lower Thursday amid talk of warm weather forecasts and softer cash prices, industry sources said.
December over-the-counter trade ranged from $2.16 to $2.17 per mmBtu this morning after settling Wednesday at $2.204 and easing to a low of $2.165 on ACCESS.
Early Henry Hub cash prices were also quoted a few cents lower at $2.07-2.08 per mmBtu, down from about $2.08-2.11 on Wednesday.
Technically, December support was seen at the ACCESS low of $2.165, which also coincides with a similar low of $2.16 on September 4. Further support was expected to surface at $2.14 and the psychological support level of $2. Some resistance was pegged near $2.30, with further resistance seen at $2.39 and $2.51.
Despite a cooler Friday forecast for the Midwest, which will likely send Chicago temperatures down into the 20s, warmer weather is expected to follow, Weather Services Corp. reports.
Next week's forecast as of Wednesday night shows above-normal temperatures throughout the U.S., with much-above-normal temperatures seen in the western half of the U.S. The one exception is the immediate East Coast, which is expected to see seasonal weather next week.
Separately, AGA said U.S. gas stocks fell last week by 45 bcf, leaving overall storage at 3.082 trillion cubic feet, or 95 percent of capacity.
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