* Cooler weather on tap in long-term outlooks
* Prices remain above key technical resistance levels
* Tropical low in Atlantic basin could become cyclone soon
By Eileen Houlihan
NEW YORK, Oct 11 U.S. natural gas futures rose
more than 1 percent on Friday and nearly 8 percent this week,
lifted by continued technical buying and short-covering ahead of
cooler weather expected later this month.
"Weather forecasts after the next five days of above-normal
temperatures in the eastern half of the country have shifted
colder in the central part of the U.S., from Texas northward
into the upper Midwest and to below- to well-below normal
temperatures in the six- to 10-day period," said Addison
Armstrong, senior director of market research at Tradition
Energy in Stamford, Connecticut.
The nearby contract garnered momentum from the
cooler-trending weather forecasts as well as offshore Gulf of
Mexico production cuts from Tropical Storm Karen last week and
over the weekend.
Front-month November natural gas futures on the New
York Mercantile Exchange rose 5.3 cents, or 1.42 percent, to
settle at $3.776 per million British thermal units.
The contract rose as high as $3.795 on Thursday after
breaking through technical resistance at the 100-day and 200-day
moving averages over the past several days. But prices remain
slightly below the two-month high of $3.82 hit three weeks ago.
Prices slid to a five-week low of $3.402 two weeks ago.
Other months ended higher as well, with the December
contract up 5.2 cents, or 1.34 percent, at $3.929 and
winter months gaining about 5 cents each.
In the cash market, gas for weekend delivery at the NYMEX
benchmark, Henry Hub in Louisiana, slid 2 cents to
$3.72. Late deals eased to 4 cents under the front-month
contract, compared with those done late Thursday at a 1-cent
Gas on the Transco pipeline at the New York citygate fell 17 cents to $3.42, while Chicago gas was 1 cent lower at $3.73.
The latest National Weather Service six- to 10-day outlook
issued on Thursday called for above-normal temperatures for the
eastern third of the nation, stretching across parts of the
South and also in the Northwest, with a large swath of
below-normal readings for the rest of the nation.
Thursday's gas storage report from the U.S. Energy
Information Administration showed total domestic inventories
rose last week by 90 billion cubic feet to 3.577 trillion cubic
Total stocks stand just about 4 percent below last year's
level and are nearly 2 percent above the five-year average.
The EIA on Friday said it would not release weekly inventory
data or other data after this week due to the government
shutdown. The agency said energy companies should continue to
submit their data to the EIA and it will be processed after the
The U.S. National Hurricane Center was tracking a low
pressure system well west-southwest of the Cape Verde Islands in
the Atlantic basin. The system had a 50 percent chance to
develop further in the next 48 hours, but it was not any
immediate threat to offshore energy production.
The U.S. Nuclear Regulatory Commission is not updating its
daily reactor status report due to the government shutdown.
However, Reuters data showed about 13,700 megawatts, or 14
percent of U.S. capacity, was likely offline on Friday, down
from 19,100 MW out a year ago and a five-year average outage
rate of 18,800 MW.
Baker Hughes drilling rig data on Friday showed the
gas-directed rig count slid for the third time in four weeks,
but the count at 369 remains well above the 18-year low of 349
hit in June.