LONDON (Commodity Online): Natural Gas prices shaved off a few pennies in the front of the curve as the weather outlook has returned to warmer-than-normal temperatures after a temporary cold spell.
The prompt contract lost five cents to $2.43/MMBtu, while the balance of calendar 2012 fell by three cents to $2.93. The back of the curve mostly edged higher with calendar 2013 adding a penny and finished at $3.75.
Overall, the market remains oversupplied with no near-term price floor in sight. Although a few more producers last week have announced drilling cutbacks and signaled they might potentially cut more supply if prices continue to drop from current levels, we believe the amount of announced producer shut-ins so far will not be enough to significantly affect prices. The weather outlook for the 6-15 day has turned incrementally warmer on the day.
Cash prices mostly dropped as a result of the warmer weather expectation. Henry Hub dropped by nine cents to $2.42. SoCal Border edged higher by four cents to $2.74. Transco-Z6 (NY) tumbled and fell to $2.88, down by $2.74.
