Cool Weather, Strong Output Pressure Natural Gas Prices as Bidweek Opens

Bidweek trading for September delivery was weaker, with basis prices at hubs in the Northeast and Midwest tumbling on the first day of trading, amid mild weather forecasts and ample supplies.

NGI’s Bidweek Alert showed basis prices at Chicago Citygate at minus 28.3 cents, near unchanged from minus 28.5 cents in August. Basis narrowed more substantially at the heavily traded Dawn hub to average minus 27.0 cents, versus minus 33.5 cents a month earlier. At the Northeast’s Algonquin Citygate, September basis on day one of bidweek averaged minus 57.5 cents, compared with minus 12.0 cents the prior month.

According to Pinebrook Energy Advisors’ managing partner Blake Owen, very mild late-August temperatures continued to pressure natural gas prices, especially in Northeast and Midwest population centers. Owen noted that the National Weather Service projected widespread below-normal temperatures across New England, the upper Midwest and into the South ahead of the start of meteorological fall on Sept. 1.