Although hot weather fundamentals continued to get a little stronger Friday, they were unable to overcome the negative market influences of the usual slump in industrial load over a weekend combined with the previous day’s bearish storage report and large screen decline.

As a result, weekend prices saw double-digit drops across the board that ranged from about 15 cents to about 45 cents. The West laid claim to most of the larger declines chiefly because of high-linepack OFOs by both of California’s giant distributors (see Transportation Notes).

The South was finally living up to its reputation for summer heat with virtually all sections recording highs in the 90s, and no change in that situation is due anytime soon. Meanwhile, the parts of the Midwest and Northeast that had been feeling unseasonably cool at midweek continued to shrink, and both regions are expected to be contributing substantially more to cooling load this week.

The West remains about as hot as ever except in coastal areas of the Pacific Northwest, but also is flush with gas supply, as attested by the OFOs issued by SoCalGas and PG&E for Saturday. In addition to the California OFOs to combat excess gas volumes, El Paso lifted its own OFO that had been issued Wednesday due to falling linepack. Also, Kern River reported high linepack again in its two farthest upstream segments after having started the week with normal linepack systemwide, and asked shippers to avoid banking gas on its system.

Friday’s softening was accomplished in a “very quiet” trading atmosphere, said a Northeast marketer. Some Monday-only deals were getting done because of forecasts for significantly higher temperatures arriving in the region then, he said, but the premiums for single-day gas were relatively modest at 5-10 cents. Production at Sable Island offshore eastern Canada is down partially for maintenance, the marketer reported, so people tended to shift some New England deals normally done at Dracut via Maritimes & Northeast to Tennessee Zone 6 or the Algonquin citygate instead.

The already high storage comfort level has gotten even stronger after the most recent report, one source commented, “so I can see serious price weakness developing by September unless we get some major heat waves and/or hurricane disruptions of production in the meantime.”

In his analysis of Thursday’s storage report, Citigroup’s Kyle Cooper recalled mentioning that some pipeline data had indicated a much larger injection than the previous week (93 Bcf) and said he’d raised his estimate accordingly to 93-103 Bcf. “We did not raise it enough and honestly, even the most bearish of our estimations would not have reached a build of 109 Bcf,” Cooper continued. “…This is only one week, and as we have stated many times, we do not alter outlooks based on one week. However, this is quite startling considering that this report did not even include the July 4th holiday. Historically, based on our models, the July 4th holiday actually has the most significant influence on storage changes.” Initial estimates for the next report are probably still near 100 Bcf but are subject to revision, he said.

Some tangible signs of activity were showing up last week in what has been a quiet Atlantic hurricane season so far. However, despite the presence of what The Weather Channel called “a few disturbed areas in the tropical Atlantic,” all remained disorganized as of Friday with little chance of significant development.

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