Sept. 7 (Bloomberg) -- Canadian natural gas dropped on forecasts for moderating weather that may limit demand for the fuel at power plants and expand a supply glut.
October gas in Alberta slid 3.8 percent as MDA EarthSat Weather in Gaithersburg, Maryland, predicted mostly normal temperatures in the central U.S. from Sept. 17 through Sept. 21. Gas inventories totaled 3.402 trillion cubic feet in the week ended Aug. 31, 11 percent above the five-year average, an Energy Department report showed yesterday.
“The natural gas market has turned lower based on a short-term cooling trend in temperatures,” said Tim Evans, an energy analyst at Citi Futures Perspective in New York, in a note to clients today. “The larger seasonal cooling trend and rising storage levels may also be having a hand in weakening the price.”
Alberta gas for October delivery fell 8.25 cents to C$2.115 per gigajoule ($2.05 per million British thermal units) as of 3:05 p.m. New York time on NGX, a Canadian Internet market. Gas traded on the exchange is shipped to users in Canada and the U.S. and priced on TransCanada Corp.’s Alberta system.
Natural gas for October delivery on the New York Mercantile Exchange dropped 9.4 cents, or 3.4 percent, to settle at $2.682 per million Btu. The futures have declined 10 percent this year.
The high in Chicago on Sept. 20 may be 66 degrees Fahrenheit (19 Celsius), 8 below normal, according to AccuWeather Inc. in State College, Pennsylvania. The high in St. Louis may be 72 degrees, 7 lower than the usual reading.
Electricity producers account for about 36 percent of U.S. gas consumption, according to the Energy Department.
Volume on TransCanada’s Alberta system, which collects the output of most of the nation’s gas wells, was 15.3 billion cubic feet at 2 p.m. New York time.
Gas was flowing at a daily rate of 1.53 billion cubic feet at Empress, Alberta, where the fuel is transferred to TransCanada’s main Line.
At McNeil, Saskatchewan, where gas is transferred to the Northern Border Pipeline for shipment to the Chicago area, the daily flow rate was 1.98 billion cubic feet.
Available capacity on TransCanada’s British Columbia system at Kingsgate was 114 million cubic feet. The system was forecast to carry 1.9 billion cubic feet today. Estimated capacity was 2.02 billion.
The volume on Spectra Energy’s British Columbia system, which gathers the fuel in northeastern British Columbia for delivery to Vancouver and the Pacific Northwest, totaled 2.74 billion cubic feet at 1:50 p.m.
To contact the reporter on this story: Christine Buurma in New York at firstname.lastname@example.org
To contact the editor responsible for this story: Bill Banker at email@example.com