Yielding to moderating weather forecasts, a 16-cent near-month drop the day before and suspicions that the upcoming storage report (to be released around noon EDT Wednesday due to the holiday) could reveal another small injection, the cash market fell in most cases Tuesday. Only a few western points that were between flat and about a nickel higher averted a clean sweep of softness.

Nearly all of the declines were in double digits, but the overall range was from about a nickel to nearly 70 cents. Declines tended to be smallest in the Louisiana Gulf Coast region and largest in the Rockies.

All points are expected to decline on Wednesday. Not only will heating load be continuing to decline, but the screen fell another 3.1 cents Tuesday to settle below the $8 level (see futures story), and the extra industrial load loss associated with a four-day holiday weekend will come into play.

Although temperatures will be rising only to seasonal levels, that will represent warm-ups starting Wednesday in the Northeast and South. The Midwest will see near-average (Ohio Valley) to well-above-average readings (Upper Midwest and Plains), while similar average-to-above-average conditions will dominate most of the West. Mercury levels will hit the 80s in the desert Southwest, The Weather Channel said.

Although it had no impact on Malin prices, which were flat Tuesday, a PG&E high-inventory OFO (see Transportation Notes) contributed to depressing PG&E citygate and Rockies quotes. In addition, Westcoast continues to encourage drafting of its system with an imbalance tolerance range of zero pack/20% draft. And both El Paso and Northwest informed customers that highly limited abilities to accept storage injections over the long weekend heightened the risk of OFO-like actions.

On the other side of the linepack coin, Florida Gas Transmission issued an Overage Alert Day due to low linepack and colder weather moving into its Florida market area.

The market is getting much quieter due to the holiday-shortened trading week, a Northeast marketer said. Relatively mild weather for late November is cutting heavily into gas demand, he said, so "expect more of the same" (falling prices) again Wednesday. Although not literally, it felt Tuesday like much of the market had already shut down for the long Thanksgiving holiday weekend, he said.

A Texas-based trader was in agreement, saying that warming trends coming up in several areas over the long weekend practically guarantee large cash price drops Wednesday. He also concurred that Tuesday's activity was very quiet with many traders either already gone for Thanksgiving or starting to leave early.

One source observed that traders should enjoy the four-day Thanksgiving weekend while they have the chance, because the Nymex calendar for 2007 eliminates the usual Friday-after-Thanksgiving nontrading day off for most industry participants.

The National Weather Service (NWS) outlook for the Nov. 27-Dec. 1 workweek calls for above normal temperatures in most of the eastern and central U.S. More specifically, NWS predicted above normal readings everywhere except most of Florida (excluding the western Panhandle) and the southeast corner of Georgia east of a line running southwestward from the Upper Peninsula of Michigan to southwest New Mexico. It looks for below normal temperatures in the Pacific Northwest along with all of Montana and Wyoming and the upper ends of California, Nevada and Utah.

Prior expectations for the storage report tend to range from a small pull to a small build, although Bentek Energy said one of its models indicates an injection that could go as high as 12 Bcf (see related story). Reuters news service said its survey found an average estimate of a 6 Bcf withdrawal out of a range of down 22 Bcf to up 5 Bcf. Analyst Tim Evans of Citigroup expects a number ranging from unchanged to 10 Bcf lower.

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