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May gas futures stall ahead of 1st day in lead role

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May gas futures stall ahead of 1st day in lead role

Assumingthe lead from the April gas contract that rolled off the board in the priorsession up 5.5 cents at a settle at $1.903/MMBtu, May natural gas futures werenear unchanged overnight ahead of the Wednesday, March 30, open, as variedweather in store that remains supportive of a mix of heating and cooling demandran against an ongoing complacency over hefty supplies. Whileclimbing back above $2.00/MMBtu to a $2.004/MMBtu overnight high, the freshfront-month contract was last traded a scant 0.9 cent higher at $1.990/MMBtu.

Thelatest weather projections continue to imply lingering heating demand in theEast and rising cooling load across the western half of the U.S.

Therevised National Weather Service forecast map for the six- to 10-day periodreflects below-average temperatures across the Northeast, Mid-Atlantic,east-north-central U.S. and a few parts of the Southeast, accompanied byaverage temperatures over a narrow band along the midsection of the Midwest,portions of the Southeast and the fringes of the Gulf Coast. Above-averagetemperatures are indicated for the balance of the country encompassing theentire West and the bulk of the central U.S.

Above-averagetemperatures grip all of the country's western two-thirds in the eight- to14-day outlook, as below-average temperatures linger over the bulk of the East.A band of average temperatures stretching from Wisconsin into Mississippi andAlabama separate the areas encompassed by above- and below-average temperaturereadings.

Althoughmidrange weather suggests some demand support that could work off excesssupply, robust natural gas inventories are expected to continue plaguing themarket through the shoulder season until demand substantially steps up andproduction cuts begin to reflect the significantly diminished to tighten theincongruent supply/demand balance.

Totalworking natural gas in storage currently sits at 2,493 Bcf, or 1,017 Bcf abovethe year-ago level and 846 Bcf above the five-year average of 1,647 Bcf, afterthe U.S. Energy Information Administration outlined an unusual net to stocks forthe week to March 18.

Marketparticipants anticipate a reprise of storage withdrawals when the next weeklyinventory data is released at 10:30 a.m. ET on Thursday, March 31, that willcover the week to March 25, with estimates calling for a drawdown of anywherefrom 16 Bcf to 33 Bcf and consensus at a 24-Bcf pull.

Astorage draw at consensus would bring overall inventories to 2,469 Bcf, stillwell above historical averages and on track toward an end-of-season level nearthe record of 2,473 Bcf reached on March 31, 2012.

Incash activity, the natural gas offering moved Tuesday for Wednesday flow wasvalued higher in much of the country, as weather-driven demand supportconspired with gains at the futures arena.

Acrossthe major delivery locations, a near 4-cent advance was seen driving benchmarkHenry Hub day-ahead gas pricing to an index at $1.771/MMBtu, as abetter-than-1-cent uptick steered Chicago spot gas price action to an averageat $1.852/MMBtu and a 1-cent increase took PG&E Gate cash gas priceactivity to an index at $1.897/MMBtu. The downside was contained at TranscoZone 6 NY, as hub prices deflated by roughly 9 cents on average to an index at$1.493/MMBtu.

Regionalaverages were boosted overall. Gulf Coast price activity for next-day gastacked on about 4 cents in deals averaging at $1.734/MMBtu, as Midwest cash gaspricing added a little more than 1 cent day on day to average at $1.690/MMBtu.West Coast spot gas prices were lifted by 6 cents on average to an index at$1.579/MMBtu, while Northeast day-ahead gas price action was bolstered by 3cents to an index at $1.659/MMBtu.

Marketprices and included industry data are current as of the time of publication andare subject to change. For more detailed market data, including power andnatural gasindex prices, as well as forwards and futures, visitour Commodities Pages.