Daily GPI / NGI All News Access

Midcontinent, West Prices Mostly Up; Soft in Rest of East

The cash market saw approximately evenly mixed movement Monday, with prices largely taking their cues from regional forecasts of either colder weather Tuesday or continued moderate conditions. It also responded to the conflicting influences of the previous Friday's 14.3-cent loss by April futures and industrial load returning from its usual weekend decline.

It was hardly a volatile market to open the week as price changes both up and down were limited to about 20 cents. About half of all trading points, mostly in the Midcontinent and West, were flat to about 20 cents higher. The rest recorded losses ranging from 2-3 cents to nearly 20 cents that were concentrated in the Gulf Coast and at Northeast and Midwest citygates.

Cash traders will continue to have negative screen guidance Tuesday as the April natural gas futures contract slid another 8 cents Monday despite strength in Nymex's nearby crude oil trading pit (see related story).

The Midwest had a mixed weather outlook. Generally, locations toward the southern and eastern sides of the region could expect either warmer temperatures or relatively little change Tuesday, while lows were expected to sink into single digits or the teens toward the western and northern ends as a low-pressure system tracks and intensifies from the Plains to Wisconsin by Tuesday night, according to The Weather Channel (TWC). Snow spreading out of the Dakotas into Minnesota during the day will become heavy with increasing winds, with blizzard conditions possible in some areas, TWC said.

The colder conditions returning to the Midwest prompted Northern Natural Gas to issue a System Overrun Limitation for all market-area zones, while KM Interstate asked shippers to adjust supply nominations to handle anticipated increases in heating load (see Transportation Notes).

Northern's bulletin board indicated how cold it will get in the Upper Midwest at midweek, saying the pipeline's projected system weighted average temperature of 33 Monday would drop to 17 Tuesday and then to five Wednesday before rebounding to 15 Thursday.

Much of the West also has a fair amount of heating load for Tuesday, with lows in the teens and 20s in the Rockies getting up to around freezing in the Pacific Northwest, but sinking to sub-zero levels in Alberta. Even interior California should have some furnaces running, with Sacramento forecast to bottom out around 40.

Meanwhile, the South continues to enjoy an early spring, with highs mostly in the 70s due Tuesday but getting into the low to mid 80s in Louisiana and Texas. A Houston-based source said he had to break down and start running his air conditioner over the weekend, and he was aware of others doing the same. However, it wasn't adding up to enough power generation load for gas to prevent the lion's share of Monday's largest price losses from occurring in Texas and Louisiana, he noted.

The Northeast was expected to rebound from Monday's one-day cold blast to more moderate conditions Tuesday. But price saw only small losses in the region at less than a dime, or were even flat to slightly higher in Transco's two Zone 6 pools, because enough cold air may be in place for some precipitation to fall as a wintry mix of sleet and freezing rain in upstate New York and interior New England Tuesday night, TWC said.

A western trader noted that the forecasts called for a reversal this week of the general mostly cold East-mild West pattern that had been in effect in the last couple of weeks. His company was seeing a pretty fair amount of heating load for Tuesday, definitely more than last week, from lower temperatures in the West, he said. But supply is plentiful, though, and there are no transportation problems, he added.

©Copyright 2009 Intelligence Press Inc. All rights reserved. The preceding news report may not be republished or redistributed, in whole or in part, in any form, without prior written consent of Intelligence Press, Inc.

ISSN © 2577-9877 | ISSN © 1532-1231
Comments powered by Disqus