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Page added on October 28, 2004

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NATURAL GAS / CRUDE OIL BTU SPREAD NARROWS

Public Policy

As of Final Postings on NYMEX 10/28:

DEC NATURAL GAS $8.684/MMBtu
DEC CRUDE OIL $8.779/MMBtu
DEC HEATING OIL $10.513/MMBtu

JAN NATURAL GAS $9.300/MMBtu
JAN CRUDE OIL $8.748/MMBtu
JAN HEATING OIL $10.556/MMBtu

The discount to crude in the December strip was about 9 cents vs. 27 cents on Wednesday. The January “premium” to crude widened 44 cents to about 57 cents. Crude Oil for December and January Deliver was down -$1.54 and -$1.43, respectively, but Natural Gas for the same strip was only down -$0.091 and $1.180, respectively, contributing to the narrowing BTU price spreads.

In addition, the Premium of the Front Month Natural Gas Dec contract vs. the Henry Hub spot price widened to about $2.50 vs. $1.00 on Wednesday. Late deals on Henry Hub seen around $6.15 vs. $7.70 on Wednesday, a drop of more than $1.50.

NWS forecasts above normal temps from 11/01-11/11.

An additional 87 million cubic feet per day of Natural Gas shut-ins were reported to be back online by the Minerals Management Service.



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