Canadian natural gas fell for a fifth day to the lowest price in six weeks as cooling demand in the U.S. dropped below normal.
July gas in Alberta declined 4.9 percent. Air conditioning demand will be 13 percent below usual in the Northeast and 9 percent less across the U.S. to June 18, according to Weather Derivatives in Belton, Missouri. The high in New York June 14 is forecast to be 76 degrees Fahrenheit (24 Celsius) 3 degrees below normal, said AccuWeather Inc. in State College, Pennsylvania.
“Weather demand in the U.S. is part of the problem,” Peter Linder, president of the DeltaOne Energy Fund in Calgary, said in a telephone interview. “Traders are now looking at it in the short term and you’re going to see wild swings in the next few weeks, but I still believe in the second half of this year we’ll see a nice recovery.”
Alberta gas for July delivery declined 8.25 cents to C$1.6175 a gigajoule ($1.48 per million British thermal units), the lowest level since April 26, as of 2:30 p.m. New York time. Gas traded on the exchange is shipped to users in Canada and the U.S. and priced on TransCanada Corp. (TRP)’s Alberta system. NGX gas is down 39 percent this year.
Natural gas for July delivery on the New York Mercantile Exchange fell 8.1 cents to settle at $2.218 per million Btu.
Spot gas at the Alliance delivery point near Chicago gained 1.85 cents to $2.2497 per million Btu on the Intercontinental Exchange. Alliance is an express line that can carry 1.5 billion cubic feet a day from western Canada.
At the Kingsgate point on the border of Idaho and British Columbia, gas advanced 3.36 cents to $1.9788 per million Btu. At Malin, Oregon, where Canadian gas is traded for California markets, prices rose 2.93 cents to $2.0769.
Volume on TransCanada’s Alberta system, which collects the output of most of the nation’s gas wells, was 16.1 billion cubic feet at 2:30 p.m. New York time.
Gas was flowing at a daily rate of 2.14 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 1.82 billion cubic feet.
There was a shortage of 211 million cubic feet in available capacity on TransCanada’s British Columbia system at Kingsgate. The system was forecast to carry 1.88 billion cubic feet today, or 13 percent above normal capacity of 1.67 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 2.95 billion cubic feet at 1:20 p.m.
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