Nymex natural gas prices

NEW YORK -- The Commodity Futures Trading Commission (CFTC) found no evidence of market manipulation behind a sharp run-up in natural gas futures prices late last year.

At one point, natural gas futures jumped almost 40 percent in one week.

"The CFTC's investigation, which was initiated in early December 2003, did not uncover evidence that any entity or individual engaged in activity with an intent to cause an artificial price in natural gas in late 2003," the commission said in a statement Monday.

Rather, the price increase was due to a number of factors, including market reaction to colder-than-expected weather in the Northeast during the first week of December 2003, it said, and market statements and projections regarding the inventory of natural gas in underground storage caverns made in late November and early December.

The CFTC said its investigative work was enhanced by the cooperation of the New York Mercantile Exchange, where natural gas futures are traded.

Nymex hired James Newsome, the commission's former chairman, as its president earlier this summer (AMM, July 12).

Kevin Foster

kfoster@amm.com