Predictably, prices were down Wednesday due to a screen drop of 18.2 cents the day before and the ongoing moderation of weather from unusually chilly conditions for early May.

Declines were measured from a nickel or so to nearly 20 cents. The softening was fairly evenly spread among the various market areas.

Futures traders threw a hitch into handicapping Thursday’s cash price direction. What seemed like undeniably bearish reports Wednesday morning on petroleum product inventories received an initially negative reaction at Nymex, but the oil-related complex then rallied and pulled the natural gas contract along with it. Gas futures ended the day up 11.5 cents, and crude oil for June delivery rose 63 cents to $50.13/bbl — leaving it above the psychological pivot point of $50 again. One source suggested that bargain hunters had started buying oil futures again after the sub-$50 level had been broached.

The American Petroleum Institute and Department of Energy differed significantly on how much crude stockpiles rose last week, but both exceeded prior expectations with estimates of a whopping 10.2 million barrels and 2.6 million barrels respectively. Both also reported gains in unleaded gasoline but declines in distillates, which include heating oil.

The dime-plus screen rise will be weighed Thursday against waning heating demand in several areas. Although mountainous areas of the West will remain cold with maximum temperatures in the 40s, and some parts of the Northeast had frost advisories in effect for Thursday morning, the overall trend is toward more normal mid-spring weather. Even the Northeast will quickly shake off its early cold with most of the region warming up nicely by the afternoon to highs in the 60s, The Weather Channel said.

One slightly bullish factor is that air conditioning load may be putting in an overdue appearance in the South soon. The Houston-area forecast calls for highs from the low to mid 80s from Friday through Sunday, and the entire eastern half of the U.S. is expected to have above normal temperatures next week.

“It should have been very bearish” in oil futures after those reports of big growth in inventories, commented a Gulf Coast producer who trades the Northeast. He reported hearing that most of the growth in crude supplies occurred in the West. The meaning of that wasn’t exactly clear, he said, but it could be about the West being less populous than the East, so a lot of the inventory increase happened away from where the most people needed it.

The producer said he was still finding a little heating demand for Thursday in the Northeast, but it wouldn’t last much longer because the region is expected to see thermometer levels in the 70s by the weekend.

It’s been unseasonably cool for quite a while, “but getting warmer each day,” said a Midwest marketer. She said a colleague talked about being reminded of January weather occasionally in the last couple of weeks when temperatures got down into the 20s. It seems like the cash market has settled down into a quiet period for early May, she added.

Citigroup analyst Kyle Cooper made a final estimation of a 48-58 Bcf storage build to be reported for the week ending April 29. He noted his forecast carried a high degree of uncertainty because “as is common during shoulder months, models may display a wide range of projections.”

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