TRD: US GAS : Futures Retreat Slightly in Choppy Trading
By John M. Biers
NEW YORK--Natural gas futures were up slightly Monday in choppy trading in a market focused on mixed weather forecasts and concerns about lost demand due to Hurricane Sandy.
Natural gas futures for December delivery were trading at $3.570 a million British thermal units, up 1.6 cents after trading in negative territory earlier in the session.
The increase comes amid forecasts for cooler temperatures followed by a warming stretch. Bob Haas, a meteorologist at MDA Weather Service, said the forecast calls for cooler temperatures in the next four to five days, especially in the mid-Atlantic and Midwest. By next weekend however, the temperatures should be higher, he said.
It's "a little bit of back and forth over the next seven to 10 days," Mr. Haas said.
Monday's trading followed a 3.9% drop in gas futures Friday amid concerns about lost demand due to Sandy and lofty stockpiles of natural gas. Last Thursday, data from the Energy Information Administration pointed to record commercial gas stockpiles.
"With seasonal peak storage expected to achieve a record level by a sizable margin in a couple of weeks, focus appears to be on supply for a while despite further expected narrowing in the year-over-year supply surplus," said Jim Ritterbusch, head of the trading-advisory firm Ritterbusch and Associates.
Besides the weather forecast and the demand picture, markets are also keeping an eye on the U.S. presidential election on Tuesday. Bob Yawger, director of energy futures at Mizuho, said he doesn't expect decisive moves by the market before the election is resolved.
"I would not be surprised if we just chop around at these levels," Mr. Yawger said. "People are reluctant to get involved with the elections so close."
