LONDON(Commodity Online): Natural Gas prices tumbled on the day as the December 2012 contract rolled off the board.
The prompt contract gave up almost all the gains from last week and ended its life at $3.37/MMBtu, down by 18 cents. Calendar 2012 fell by 12 cents to $3.74, while calendar 2013 dropped nine cents to $4.33.
Monday's price action clearly shows that the market ignored last week's drop in the gas-directed rig count. The count is at the lowest level since January 2010. Even given the pullback, the market appears to expect supply growth to continue.
Instead, market participants continue to focus on the bearish weather forecast. Even though the 6-10 day outlook turned incrementally colder on the day, the 11-20 day period is predicted to see warmth returning to most of the country.
In the cash market, all price points surged after the holiday weekend. Henry Hub increased by 25 cents, to $3.09. New York (Transco-Z6) pushed up by 31 cents, to $3.29. SoCalBorder rose by 28 cents, to $3.40.
