Major weather forecast contrasts for Tuesday -- cold to below-freezing lows in much of the northern half of the U.S. and Canada, along with highs due to hit the mid to upper 80s and even low 90s occasionally in several broad swaths across the southern U.S. -- combined to produce spot price gains at all but two locations Monday.
The restoration of industrial load that dropped during the weekend was an additional minor bullish factor, while the previous Friday's futures drop of less than a penny essentially had no influence on Monday's cash numbers.
Flat MRT and NOVA Inventory Transfer quotes and an Empress dip of about a nickel were exceptions to overall increases ranging from 2-3 cents to about a quarter. Most of the larger gains occurred at the Chicago citygate and in the Midcontinent, Rockies and Northeast.
May futures have negative support for Tuesday's cash market as they finished Monday down 6.6 cents (see related story). Henry Hub's small gain combined with the screen loss to lift the hub to a premium of about a dime over prompt-month futures.
Tennessee made some contribution toward higher prices into its pipe by lifting a systemwide Imbalance Warning (see Transportation Notes) that had required customers to either stay strictly in balance or run imbalances that would tend to reduce overall linepack.
In what it called the "wintry air stubbornly stuck over the northern half" of the Midwest, The Weather Channel (TWC) said as much as 2-8 inches of snow is expected across parts of the Dakotas. More heavy snow will develop from Tuesday evening into Wednesday across the Upper Midwest, TWC said, but it predicts that the solid precipitation will be replaced by rain and strong-to-severe thunderstorms across the Ohio Valley.
Subfreezing lows will visit the northern Rockies, Upper Plains and Western Canada Tuesday, but most of the Midwest is unlikely to get any lower than freezing. The outlook gets more moderate going eastward; the Northeast will be chilly, but only the upper New England section is likely to get colder than the low 40s.
Meanwhile, cooling demand is rising in most of the South as peak temperatures throughout the 80s as far west as Oklahoma and Texas are predicted, with parts of Texas due to record most of the 90-plus readings. The Phoenix area also is expected to get a little above the mid 80s, but that actually reflects a cooling trend from temperatures that were about 10 degrees higher Sunday. And Southern California is uncharacteristically cool with highs limited to the low to mid 60s Monday and Tuesday.
IntercontinentalExchange (ICE) found the Chicago citygate rising by a little more than 15 cents while volumes traded there on the ICE platform jumped from 738,200 MMBtu Friday to 899,100 MMBtu Monday. This came despite a warming trend that is expected to keep Windy City temperatures above 40 Tuesday.
His company's service area got a "sneak peek at spring" a couple of weeks ago, but the milder season has gone back into hiding for the time being, a Midwest utility buyer said. The utility was still experiencing a relatively strong amount of heating load, he added. Its current gas throughput is only about half of the 200 MMcf/d or so that is normal during much of the winter, but sales were still running high for mid-April, the buyer said. However, there is a good chance of warmer conditions returning around Easter Sunday, he said.
The Baker Hughes Rotary Rig Count found 885 drilling rigs active in the U.S. targeting natural gas during the week ending April 15, down four from a week earlier. Five rigs were added in the Gulf of Mexico, Baker Hughes said, while nine were deactivated onshore. The latest tally is 1% higher than a month ago but down 9% from the year-earlier level.
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