Volume 336 July 29, 2010

Market Update:
August natural gas futures expired yesterday at $.4774 per therm. September is now the front month. Natural gas traded slightly higher this week and headed higher this morning after the storage was announced. The widespread heat, the Hurricane season potential, strong natural gas electric generation and investment banks reporting that a seasonal bottom may have occurred in late May are supporting prices. Strong nuclear electric generation could keep prices stable. Natural gas is attractive to fix at this time to protect the winter period. Production remains at more than sufficient levels due mostly to on-shore shale drilling. The North American rig count is 982 this week. This is 624 units lower than the peak of 1,606 units on 9-12-08. After a general rise in count starting 47 weeks ago the count has leveled off.....but rising.

The Crude oil price for September is lower this week at $77.39 per barrel. Unleaded gasoline futures are lower this week at $2.08 and gasoline at the pump is around $2.89…in Indiana. The natural gas storage report today was an injection of 28 BCF; lower than our analyst’s prediction of +27 BCF. Storage is 94 BCF lower than last year but 239 BCF higher than the 5 year average.  

Weather -
Thu: Plenty of sunshine. High 82F. Winds NE at 5 to 10 mph. Fri: Some sun in the morning with increasing clouds during the afternoon. High 81F. Winds SSE at 5 to 10 mph. Sat: Partly cloudy, chance of a thunderstorm. Highs in the low 80s and lows in the mid 60s. Sun: A few clouds. Highs in the low 80s and lows in the upper 60s. Mon: Mostly cloudy. Highs in the mid 80s and lows in the low 70s.

Above Graph – Setember 2010 NYMEX gas futures.
(Click Graph to Enlarge)


The graph above shows storage levels as of 7-29-2010.
(Click Graph to Enlarge)

Sincerely,

Jim Deering
708-579-0005

Gerry Herr
219-865-2201

Sean Deering
630-321-0666

Alberto Perales
630-321-0888

Bridget Murphy
630-321-0888

Andres Rodriguez
630-321-0888

Gas Storage Statistics: (BCF) Billion Cubic Feet
This Week: 2,919
Last Year: 3,013
5 Year Ave: 2,680

The total of 2,919 BCF is an increase of 28 BCF from last week lower than the analyst’s prediction of +27 BCF.            

Comparative Fuels:
Futures Prices for July 2010

North American Natural Gas Rig Count
This Week: 982
Last week: 979
Year Ago this week: 675

NYMEX Futures Price for Winter -
Nov 10 - Mar 11: $.5331 per therm

NYMEX Futures Strip Price for 1 YR-
Aug 10 - July 11: $.5179 per therm

July 29, 2010
(Click Map to Enlarge)