The September aftermarket got launched on a generally softening note Friday. Most points fell between about a nickel and a quarter from end-of-August levels, and also started out anywhere from about 15 cents to more than 50 cents below their first-of-month indexes. (Trading was done for the Sunday-Tuesday period since deals had been cut on Thursday for the last two days of August.)

There was no mystery in the downturn, which had been anticipated Thursday, sources said. They cited two preceding days of sizeable Nymex weakness (although the screen managed a rally of nearly a nickel Friday), mild temperatures outside the southern edge of the U.S. that were expected to continue into the weekend, the typical drop in industrial load over a long weekend and Thursday’s bearish storage report.

There were exceptions on both sides of the overall trend. Most of the Rockies pipes gained between a nickel and a dime due to the end of a one-day Northwest outage that had backed up supply into the region for Friday’s gas day (Questar bucked the regional tendency by falling about a nickel into the low $0.60s). However, even with their upticks, Rockies prices still averaged well under a dollar. And they’ll take another big hit Tuesday as Northwest has the last of three one-day outages planned for Wednesday.

On the other hand, Columbia-Appalachia (TCO) and the San Juan Basin registered the day’s biggest declines of between 35 cents and 75 cents. TCO yielded its temporarily held title as most expensive point to Florida citygates as more interconnect receipts tended to displace TCO’s Appalachian pool supplies. Meanwhile, buyers in Florida continued to chafe under Florida Gas Transmission’s long-running Overage Alert Day notice, although imbalance tolerance remained at a relatively loose 15% Friday.

San Juan numbers apparently felt the greatest impact from a PG&E OFO and dwindling east-of-California demand as triple-digit temperatures receded somewhat. Although the PG&E citygate saw one of the day’s larger losses of about 20 cents, a marketer said he was surprised “that prices are holding up as well as they are” in light of the utility’s issuing a high-linepack OFO for Saturday (see Transportation Notes).

Colleagues may have had to forgive some traders for breaking out into a chorus of Hello, Dolly. Tropical Depression Four was upgraded into Tropical Storm Dolly, which as of Friday afternoon was 1,480 miles east of the Windward Islands (the southern half of the island chain between Puerto Rico and Venezuela). It was accorded a good chance of strengthening into a hurricane over the long weekend as it continued its westward trek.

An East Coast utility buyer thought Dolly was “too far out in the Atlantic for us to worry about it getting here before the end of the holiday weekend.” But a producer perceived “a little bit of concern” that Dolly could be approaching the Gulf of Mexico by the time trading starts up again Tuesday. That was about the only thing propping up the screen Friday, he believed; “otherwise I would have expected it to be falling along with cash.”

A utility buyer thought “storm hype” was behind Midcontinent/Midwest prices going up as trading proceeded Friday morning. Chicago citygates started in the high $3.00s, jumped nearly a dime and continued to trade there for the rest of the session, she said. Field numbers behaved similarly, she added. “Some are saying it’s due to Dolly. We haven’t had anything to speak of in the hurricane season yet, so everybody is a little more excited than usual about what Dolly might do.” The buyer speculated there might be a little extra punch in Dolly’s “hype” because it achieved tropical storm status so far out in the Atlantic; usually storms don’t earn a name until they’re much closer to the Americas.

A marketer agreed about the upward trend in Midcontinent quotes. “Towards the end of trading Northern Natural-demarc was screaming higher. There was some general shortness in parts of the Midwest, and lots of traders who were looking to start the weekend early decided that it wasn’t a good time to haggle over pennies,” he said.

Although it averaged down about a nickel in the mid to high $3.30s, Transco Zone 6-NYC ran as high as $3.50 on a late short squeeze prompted by shippers electing to strand their capacity and sell gas in the Gulf Coast instead, a marketer told NGI. “The spreads weren’t there for most of the morning,” he lamented. “With variable cost of transport at just under 40 cents and [Texas Eastern] East Louisiana fetching in the $3.00s, it just didn’t make sense to ship gas up to M-3 [where prices averaged in the mid $3.30s Friday]. That created a shortfall in New York, which forced buyers to pay up late. Both Transco and Tetco were affected, but the biggest price increase was registered at Zone 6-NYC.”

“Finally, an EIA report that came out on the high end after weeks of being below expectations!” exclaimed a marketer. He said it was nice to put some downward pressure on the market, “although prices haven’t gone down as much as I thought they would. Prices really haven’t been reasonable for quite a while.”

A Midwest marketer reported a wide range in bidweek trading. “We saw Chicago in the $3.07-8 area on the low end in late deals, while last Monday it was trading up around $3.50.”

A Northeast marketer perceived “a tanker of Distrigas LNG” as being responsible for weak bidweek prices at the Algonquin citygate. “That could mean an extra couple hundred thousand a day on the market during September, the biggest shoulder month of them all,” he said. Another source said a further depressant on Algonquin prices was “cheap Sable Island production finding its way down Maritimes & Northeast to Algonquin.”

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