Natural Gas Rally +.24
NEW YORK: Gas rally 23/08/2002 07:41:25
Natural gas futures for September delivery on the NYMEX jumped 7.4% higher yesterday, gaining $0.241 to $3.515 per MMBtu, driven higher by a bullish natural gas storage report and heavy buying by trade, funds and locals, reports ENERFAX.
The October contract rose $0.252 to $3.591 per MMBtu. The market has risen almost $0.90 since August 7th. The EIA reported only 37 Bcf injected into storage, somewhat less than the 40 - 50 Bcf expected.
There is now 2.657 Tcf in storage compared to 2.426 Tcf a year ago, and a 5-year average of 2.35 Tcf. The rally was supported by technical buying and heavy short covering by funds that have shown extreme net short positions in the late summer. Look for profit-taking today, and a pullback in the near-term.
On the upside, short-term resistance is seen at $3.60. The Edison Energy Institute said more than 80,000 gigawatts of power was generated last week across the nation, the 8th consecutive week above that level, an indication of steady demand. Injections are still on pace to reach 3.25 Tcf by this winter.
Storage injections for last week were 5.3 Bcf per day vs. 9.1 Bcf per day a year ago, and a 5-year average of 12.2 Bcf per day. Cooling degree days were 91 versus 75 last year, 77 normally and a 5-year average of 78.
Yesterday, about 125,000 contracts traded, with a third being spreads. On Wednesday, volume was 95,729 contracts.
Natural gas for next day delivery across the US and Canada was generally $0.10 - $0.15 higher.
Natural gas for next day delivery at the Henry hub gained $0.14 to $3.36 per MMBtu.
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