Analyst "We don't have enough gas to get us through the winter."

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Natural gas tops $10 on supply drop Crude, distillate, gasoline inventories head lower

By Myra P. Saefong, CBS.MarketWatch.com Last Update: 6:07 PM ET Dec 27, 2000 NewsWatch Latest headlines Get Alerted

NEW YORK (CBS.MW) - Natural-gas futures prices topped $10 Wednesday for the first time as cold weather in the eastern U.S. caused a huge decline in inventories and raised concern about dwindling reserves as winter picks up.

"We're in trouble," said Robert Christensen, Jr., an analyst at FAC/Equities. "We don't have enough gas to get us through the winter."

12/27/2000 2:16:46 PM ET On the New York Mercantile Exchange, January natural gas closed at $9.98 per million British thermal units, up 17.5 cents after a late break above $10. The commodity's February contract, which became the lead futures contract at the market's close, rose 16 cents to $9.286.

January heating oil, another commodity used for heating homes, rose 0.21 cent to 93.71 cents a gallon.

Late Wednesday, the American Gas Association said natural gas inventories, as of the week ended Dec. 22, fell 175 billion cubic feet. Supplies were expected to be down 155 billion to 200 billion cubic feet, a Bridge survey of analysts said. A year ago, supplies fell 173 billion.

Total supplies of 1,938 billion are now 632 billion cubic feet below last year's level.

The nation has seen "tremendous" additions to residential and commercial natural-gas loads over the last decade, Christensen said, but all of that added load "created by this wonderful economy hasn't been tested."

The country hasn't seen a colder-than-normal winter in 15 years, he said. The U.S. entered winter 20 percent under-filled and there's still about 65 percent of winter ahead of us, he added.

http://cbs.marketwatch.com/news/current/futures.htx?source=blq/isynd

-- Martin Thompson (mthom1927@aol.com), December 27, 2000


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