SF: Natural Gas Futures Decline on Easing Gulf Storm Concerns
Sept. 29 (Bloomberg) -- Natural gas futures fell in New York on easing concern that storms will disrupt gas production in the Gulf of Mexico before the end of the hurricane season.
A storm over central Cuba is likely to reach southeastern Florida tonight, steering clear of energy pipelines and platforms in the Gulf, according to National Hurricane Center forecasts. An area of showers and thunderstorms in the central Atlantic has a 10 percent chance of becoming a tropical cyclone during the next 48 hours. The hurricane season ends Nov. 30.
"There's a lot of talk about the weather pattern showing that hurricane season is over," said Mike Rose, the director of energy trading for Angus Jackson Inc. in Fort Lauderdale, Florida. Prices may stay within a range of $3.75 to $4 per million British thermal units this week, Rose said.
Natural gas for November delivery fell 1.4 cents, or 0.4 percent, to $3.937 per million Btu at 10:04 a.m. on the New York Mercantile Exchange. Prices have fallen 29 percent this year.
The National Oceanic and Atmospheric Administration last month reduced its 2010 Atlantic hurricane forecast to 14 to 20 named storms from an earlier estimate of 14 to 23.
A total of 7.9 billion cubic feet of natural gas production was temporarily shut off because of storms in June, July and August, compared with the Energy Department's prediction of 57.4 billion for those months.
"As far as any production threats to energy interests in the Gulf of Mexico, the probability is very low at least into mid-October," said Travis Hartman, a meteorologist with MDA Federal Inc.'s EarthSat Energy Weather in Rockville, Maryland. An area of low pressure is preventing storms from entering the Gulf, Hartman said.
Cooler Weather
Beyond mid-October, wind conditions may prevent storm formation, Hartman said. The statistical peak of the Atlantic hurricane season is Sept. 10.
Below-normal temperatures are likely in the southeastern and south central U.S. from Oct. 4 to Oct. 8, according to MDA. Temperatures across much of the western U.S. and northern Midwest may be warmer-than-normal during that period, MDA said.
About 23 percent of U.S. electricity is generated using natural gas, according to the Energy Department.
