Market watch: Natural gas leads retreat of energy futures prices
US natural gas futures fell Wednesday, pulling oil and refined products down with it, as the American Gas Association reversed an earlier reported drawdown from storage and Tropical Storm Chantal ceased to menace Gulf of Mexico production.
By the OGJ Online Staff
HOUSTON, Aug. 23 -- US natural gas futures fell Wednesday, pulling oil and refined products down with it, as the American Gas Association reversed an earlier reported draw down from storage and Tropical Storm Chantal ceased to menace Gulf of Mexico production.
As analysts predicted, the AGA revised its previous report of a 12 bcf withdrawal to a 35 bcf injection of gas in the key eastern US market during the week ended Aug. 10 (OGJ Online, Aug. 16, 2001). That boosted total US gas injections to 50 bcf for that week, instead of the 3 bcf originally reported.
Another 86 bcf of gas were injected into US underground storage during the week ended Aug. 17, the AGA said. US gas storage now totals 2.4 tcf, or 327 bcf more than a year ago.
"It appears that natural gas has still not made any ground in recouping any more of the 'lost demand' from 1 year ago, said Robert Morris, energy analyst at Salomon Smith Barney Inc., in his weekly exploration and production report Wednesday.
The September natural gas contract dropped 31.8¢ to $2.84/Mcf on the New York Mercantile Exchange. Competitive home heating oil for the same month dipped by 0.17¢ to 72.82¢/gal.
The October contract for benchmark US sweet, light crudes also tumbled 35¢ to $26.37/bbl, while the November contract lost 23¢ to $26.35/bbl. However, both contracts moved up in after-hours electronic trading to $26.42/bbl and $26.36/bbl, respectively.
Unleaded gasoline for September delivery slipped 0.16¢ to 78.25¢/gal on the NYMEX.
Following the US market's lead, North Sea Brent crude futures fell across the board in late afternoon trading on the International Petroleum Exchange in London.
The October Brent oil contract closed at $25.35/bbl Wednesday, down 14¢ for the day after trading in a range of $25.33-$25.94/bbl. However, the September natural gas contract jumped 7.2¢ to the equivalent of $2.60/Mcf on the IPE.
The average price for the Organization of Petroleum Exporting Countries' basket of seven crudes gained 5¢ to $24.33/bbl Wednesday.