A prior-day screen advance of less than a dime contended for primary influence on Wednesday’s cash market with generally moderate weather fundamentals and expectations that Thursday morning’s storage report will show that the industry returned to net injection mode last week. The results were mixed, with most points remaining close to flat and few straying more than about a dime up or down from Tuesday’s levels.

The biggest losses of up to about 30 cents occurred in the Rockies, where there was some uncertainty about when Wyoming Interstate Co. (WIC) would be able to restore its full capacity following a rupture west of Cheyenne Station last Saturday (see Transportation Notes). The pipeline said Wednesday that due to welding delays, it had to continue curtailing all mainline volumes to zero that day, but it anticipated being able to accept nominations for full Thursday flows in the Timely cycle. A spokesman said Wednesday afternoon there were no new developments since WIC ‘s posting that morning.

PG&E’s extension of a systemwide Stage 2 high-inventory OFO through at least Thursday added further negative price pressure to Rockies and some other western points.

Outside the Rockies, prices ranged from about a dime lower to more than 20 cents higher.

Traders continue to see a fair amount of heating load, but other than in most of Canada, the mountainous areas of the West and the western section of the South, it’ less that what could normally be expected in the middle of November. However, December futures will be providing a little more support for cash quotes than before following an increase of 14.3 cents Wednesday.

Fundamentals are still pretty weak for the most part, a marketer said. The cash market might see some small upticks Thursday because temperatures will be getting a little cooler going into the weekend in the Midwest and to a lesser degree in the Northeast, he added; he also noted the larger Nymex gain Wednesday. However, overall heating demand is still fairly modest at this point, he said. Boston will keep seeing highs in the 50s and 60s until about Sunday, when they will drop into the 40s, he pointed out. On the other hand, Chicago should be seeing a moderate warm-up starting early next week, he said.

Analyst Tim Evans of Citigroup has little sympathy for gas market bulls right now. “For example, the ‘cold snap’ in the Southeast they are touting looks relatively weak,” with temperatures forecast to average two to four degrees below normal over the upcoming six-to-10-day period, according to the latest Fronter Weather “Degree Day Summary,” he said. Also, the “cold” will be offset by warmer than normal temperatures across much of the West, Midwest and New England, Evans said. “Then, there’s this little unresolved matter of Thursday’s storage report, which we think could show a net injection of 30-40 Bcf. A build of that magnitude could easily slam the door on further [futures] gains.”

The National Weather Service’s (NWS) six-to-10-day forecast for the Nov. 20-24 period calls for above-normal temperatures almost everywhere west of a line roughly approximating the Mississippi River’s course. The prediction of above-normal conditions also includes most of the Midwest east of the Mississippi except Ohio, but excludes normal readings expected in eastern Louisiana, the southern tip of Texas and northwest Oregon, the northern end of Idaho and all of Washington state. Above-normal readings are also likely in the northern end of Maine, NWS said. The agency looks for below-normal temperatures only in the South Atlantic states from the western end of Florida’s Panhandle through eastern Virginia.

The Reuters news service survey of 24 industry players found an average build of 8 Bcf expected in the upcoming storage report for the week that ended Nov. 10. The range of estimates ran from a draw of 8 Bcf to an injection of 35 Bcf, Reuters said.

©Copyright 2006Intelligence Press Inc. All rights reserved. The preceding news reportmay not be republished or redistributed, in whole or in part, in anyform, without prior written consent of Intelligence Press, Inc.