Natural-Gas Futures Extend Gains [View all]

http://online.wsj.com/article/SB10001424052970203718504577180781984236586.html

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Futures added to Monday's gains that were sparked by Chesapeake Energy Corp.'s decision to cut production in response to low gas prices.

"This is continued momentum from yesterday's announcement from Chesapeake," said Matt Smith, an analyst with Summit Energy. "This has set in a concrete level where production will start to come off."

After gas fell to the lowest price in nearly a decade last week, signs that producers are prepared to turn off the taps have motivated investors to take profits generated from bets on falling prices, a move known as covering a short position.

Chesapeake on Monday said it will immediately curtail 0.5 billion cubic feet a day of gas production, or about 8% of its total output, adding that it could cut an additional 0.5 billion cubic feet a day.

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