The fickle nature of weather trends came into play in the gas market again Friday as hot weekend forecasts for much of the U.S. and even extending into parts of central and Eastern Canada generated rallies at a large majority of points. The previous day's 2.5-cent futures loss following a moderately bearish storage report and the usual weekend decline of industrial load had relatively minimal impact.
Several flat locations were mixed into mostly single-digit gains that ran from 2-3 cents to about 40 cents. Although most of the Northeast could expect peak temperatures to be limited to the upper 80s Saturday, The Weather Channel said the region would continue to get warmer through the weekend, which helped generate most of Friday's largest increases.
The futures market apparently was able to shake off Thursday's storage injection report, which exceeded consensus expectations, as the prompt-month contract provided plentiful support for the cash market Monday with a spike of 16.8 cents (see related story).
What the National Hurricane Center described as "an area of disturbed weather" was moving inland Friday morning over Nicaragua and Costa Rica and had a near-zero chance of becoming a tropical cyclone.
A heat wave that was sparing only the West Coast showed little signs of letting up through the weekend and the upcoming week, although some parts of the eastern South would be easing back into the mid to upper 80s Saturday, according to the Weather Central forecasting firm. Triple-digit highs were expected to continue from the Midcontinent and Texas through the desert Southwest, and the Rockies wouldn't be far behind in experiencing peaks in the low 90s.
Even such normally mild north-of-the-border places as Winnipeg, MB, could anticipate topping out around 90 Saturday, Weather Central said.
El Paso said Friday customer cooperation had been sufficient for it to cancel a warning of a potential Strained Operating Condition due to high linepack. However, both SoCalGas and Westcoast still had systemwide high-linepack OFOs in place.
As an indicator of heat beginning to build in the Midwest again, ANR said it expected high flow rates at many power plants on its system to continue through the coming week, and thus effective Saturday it was requiring shippers to maintain uniform volumes throughout each 24-hour gas day.
In its most recent (Tuesday afternoon) update of statistics on flooding-related shut-ins in the Atchafalaya Basin of South Louisiana, the state's Department of Natural Resources said gas losses had shrunk to 17.9 MMcf/d from a peak of a little under 32 MMcf/d last month.
The National Weather Service predicted above-normal temperatures for everywhere in the eastern two-thirds of the U.S. except Florida from midweek through the coming weekend. It indicated the biggest deviations above normal in the Midwest and the lower Northeast through much of the Mid-Atlantic.
Even though Enogex did not announce Monday's completion of a Line 19 maintenance outage (see Daily GPI, July 5) on its bulletin board until Friday, a Midcontinent producer said the constraint's removal had greatly facilitated his company's sales opportunities. With no relief from state temperatures topping 100 degrees in sight for at least the next week or so, he cited a report of Oklahoma Gas & Electric power load peaking at 6,456 MW recently and said the utility "probably will be pushing this [demand] over the next few days."
The producer also reported Panhandle Eastern swing swaps being bid on IntercontinentalExchange at $4.43 for the balance of July, which was about a dime above the pipeline's spot gas average Friday.
After seeing relatively small changes in recent weeks, the Baker Hughes Rotary Rig Count reported a big jump of 12 to 885 in the number of active gas-directed drilling rigs in the U.S. for the week ending July 15. Ten rigs were added onshore, Baker Hughes said, while two more were activated in the Gulf of Mexico. Its latest tally was 2% higher than a month ago but down 10% from the year-earlier level.
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