MARKET WATCH: Natural gas prices slide for third day
Paula Dittrick
OGJ Senior Staff Writer
HOUSTON, Apr. 9 -- Natural gas prices fell for a third consecutive day Apr. 8 on the New York market upon a weekly US government report showing a large injection of gas into underground storage.
The US Energy Information Administration reported 31 bcf was injected into storage for the week ended Apr. 2, raising working gas in storage to 1.669 tcf. That’s down 2 bcf from the year-ago storage level, but 180 bcf above the 5-year average.
Barclays Capital analysts also attributed the lower gas prices to lower demand expectations based upon milder weather forecasts.
“What mother nature gives, mother nature takes. Natural gas markets are no exception,” analysts said. “After a generously cold winter, nature has pulled its pillar of support away from natural gas prices and instead is cheering up those enjoying the weather outside,” they said.
Sweet, light crude oil prices generally seem to have established themselves in the mid-$80/bbl range on the New York Mercantile Exchange, analysts said.
Earlier this week, the front-month crude oil benchmark contract jumped above $86/bbl—its highest price since Oct. 8, 2008. The NYMEX May contract for benchmark US sweet, light crudes settled at $86.62/bbl on Apr. 5 (OGJ Online, Apr. 6, 2010.).
Energy prices
In NYMEX trading on Apr. 7, the May sweet, light crudes contract closed at $85.39/bbl, down 49¢ for the day. The June contract lost 48¢ to $86.03/bbl. On the US spot market, WTI at Cushing was down 49¢ to $85.39/bbl. Heating oil for May delivery declined 1.57¢ to $2.228/gal on NYMEX. Reformulated blend stock for oxygenate blending for the same month decreased 1.64¢ to $2.298/gal.
The May natural gas contract dropped 11¢ to $3.909/MMbtu on NYMEX. During the Apr. 7 trading session, the gas contract dipped to a low of $3.857/MMbtu before rebounding for the settlement price. On the US spot market, the gas price at Henry Hub, La., dropped by 20¢ to $3.89/MMbtu.
In London, the May IPE contract for North Sea Brent crude fell 78¢ to $84.81/bbl. Gas oil for April dropped $7.55 to $708.50/tonne.
The average price for OPEC’s basket of 12 reference crudes was down 76¢ to $81.65/bbl.
Contact Paula Dittrick at [email protected].