for week ending March 3, 2002 | Release date: March 4, 2002 | Previous weeks
Spot prices wound up
slightly higher for the week (Friday to Friday) after trading within relatively
narrow ranges with only regional exceptions.On the NYMEX futures market, the March contract expired on Tuesday, February
26, 2002, at $2.388 per MMBtu, ending with a gain of $0.321 per MMBtu since
becoming the near-month contract on January 29.Tuesday also saw the largest increase in spot prices, as a huge
Arctic air mass expanded from the Central Plains States into the Midwest and
Southwest, bringing some of the coldest temperatures thus far this winter.Daily average temperatures on Tuesday
through Thursday in major cities in the Central and Southwest regions ranged
from 6 to 18 degrees below normal and up to 8 degrees below normal in the
Midwest.Equally sharp temperature
drops were seen in the Southeast by Wednesday. (See
Temperature Map) (See Deviation Map). At the Henry Hub, the spot price gained a nickel on Tuesday, but
for the week was up by only 9 cents, to $2.49 per MMBtu.The new near-month contract, for April
delivery at the Henry Hub, ended the week at $2.359 per MMBtu. The spot price
for West Texas Intermediate crude oil moved above $22 per barrel for the first
time since early November, gaining $1.45 for the week and ending trading on
Friday at $22.37 per barrel, or $3.86 per MMBtu.
Prices:
Spot
prices generally moved up on Monday and Tuesday in response to one of the few
widespread cold fronts of the winter, but increases were limited to less than
10 cents at most market locations.New
York and Florida citygate prices were the glaring exceptions.Spot gas for New York delivery rose over
$1.00 to $3.74 per MMBtu by Wednesday, while surging demand on the Florida Gas
Transmission system elicited two consecutive Overage Alert Days and sent prices
up by $1.75 to $4.50 per MMBtu.However, moderating temperatures by Friday, coupled with forecasts for
milder weekend weather for the Eastern seaboard, quickly brought these prices
back down.By week's end,
Friday-to-Friday price increases at New York and Florida citygates had narrowed
to 29 and 30 cents, respectively, as spot prices stood at $2.93 and $3.00 per
MMBtu. Meanwhile, a second cold front invaded the Rockies late in the week,
reversing Wednesday's brief respite of softening prices there and providing an
end-of-week boost to spot prices at many locations in the country's midsection,
Texas, and the Gulf Coast.Rockies
prices rose an average of $0.24 per MMBtu from the previous Friday, reaching
$2.27 by Friday, March 1, while the Chicago citygate price rose $0.14 to $2.56.By contrast, California and the Southwest
enjoyed warmer than normal temperatures for most of the week.A high-inventory operational flow order on
the PG&E system on Tuesday and Wednesday had prices falling slightly on
those days.Nevertheless, California
prices moved up for the week, as more of Rockies gas was staying at home or
moving eastward.By Friday the spot
price on PG&E was up 13 cents to $2.46 per MMBtu, while the Southern
California Border average was up 22 cents to $2.42.
On the NYMEX futures
market, the expiring March contract recovered part of its sharp 14-cent drop of
Monday by gaining $0.081 per MMBtu on Tuesday, its final day of trading, to
close at $2.388.On its first day of
trading as the near-month, the April contract managed to settle above $2.40 per
MMBtu.But it settled on Friday at
$2.359, down almost 7 cents from its first day in the near-month position, and
down $0.132 from the previous Friday.The settlement prices for out-month contracts through January 2003 also
declined by up to 13 cents for the week (Friday to Friday), with the
highest-priced gas over this period being for January 2003 delivery, at $3.314
per MMBtu.The National Weather Service
(NWS) latest 6- to 10-day outlook calls for normal to above-normal temperatures
for most of the nation, including the high gas-consuming regions of the
Northeast and Midwest, implying potential downward pressure on futures prices.
Spot Prices($ per MMBtu) |
Mon. |
Tues. |
Wed. |
Thurs. |
Fri. |
25-Feb |
26-Feb |
27-Feb |
28-Feb |
1-Mar |
|
Henry Hub |
2.40 |
2.45 |
2.48 |
2.48 |
2.49 |
New York citygates |
2.67 |
3.18 |
3.74 |
3.33 |
2.93 |
Chicago citygate |
2.43 |
2.50 |
2.49 |
2.52 |
2.56 |
PG&E citygate |
2.43 |
2.38 |
2.37 |
2.45 |
2.46 |
So. Cal. Border Avg. |
2.29 |
2.36 |
2.34 |
2.39 |
2.42 |
Futures ($/MMBtu) |
|
|
|
|
|
March delivery |
2.307 |
2.388 |
expired |
expired |
expired |
April delivery |
2.348 |
2.389 |
2.427 |
2.357 |
2.359 |
May delivery |
2.410 |
2.449 |
2.479 |
2.415 |
2.416 |
Source: NGI's
Daily Gas Price Index (http://intelligencepress.com) |
Storage:
Net withdrawals of natural gas from storage were 64
Bcf for the week ended February 22 according to the American Gas Association.
This is the lowest that net withdrawals have been for the report week since
1997.Net withdrawals during the week
were nearly 37 percent less than last year, and almost 28 percent less than the
5-year average during the report week.Warmer than normal temperatures across much of the country that week
likely accounted for the below average withdrawals.Gas-weighted heating degree-days were over 23 percent below
normal on average in the United States according to the NWS.In each of the nine Census Divisions of the
continental United States, heating degree-days ranged between 14 and 34 percent
below normal for the week.Likewise,
withdrawals in the East and Producing regions were nearly 25 and 33 percent
below the 5-year average, respectively.In the West region, where the 5-year average withdrawal for the
report week is 7 Bcf, total inventories remained unchanged from the prior
report.If net withdrawals match the
maximum level of withdrawal achieved during the past 5 years for the remainder of
the heating season, working gas stocks will be approximately 1,548 Bcf at the
end of March, over 41 percent greater than the 5-year average.(See
Storage Figure)
All Volumes
in Bcf |
Current
Stocks (Fri, 2/22) |
Estimated
Prior 5-Year (1997-2001) Average |
Percent
Difference from 5 Year Average |
Net Change
from Last Week |
One-Week
Prior Stocks (Fri, 2/15) |
East Region |
1,089 |
802 |
36% |
-54 |
1,143 |
West Region |
248 |
193 |
28% |
0 |
248 |
Producing
Region |
619 |
386 |
60% |
-10 |
629 |
Total Lower
48 |
1,956 |
1,382 |
42% |
-64 |
2,020 |
Note:net change data are estimates published by
AGA on Wednesday of each week.All
stock-level Figures are EIA estimates based on EIA monthly survey data and
weekly AGA net-change estimates.Column sums may differ from Totals because of independent rounding. |
Summary:
Spot
prices generally moved higher on the strength of increases accompanying
consecutive cold fronts.Futures prices
moved lower, although the new near-month contract (April delivery) held above
$2.30 per MMBtu.Stocks continue to
exceed the 5-year average by wide margins in all regions.