Buffeted by prior-day futures weakness, the lack of any tropical threat to offshore production and generally moderate temperatures for early July in many areas, cash prices fell by double-digit amounts at all points Friday. The usual weekend layoff of industrial load also played a bearish role.

Declines ranged from a little more than a dime to a little more than 65 cents. The Florida citygate saw by far the day's steepest slope despite Florida Gas Transmission keeping a market-area Overage Alert Day in place through at least Friday, citing predictions of mid-90s peak temperatures continuing in the Sunshine State.

August futures will provide meager support for Monday's cash market after rallying by 0.3 cent Friday (see related story).

The National Hurricane Center issued its final advisory on Tropical Depression 2 (TD2) early Friday morning after the system -- much like predecessor Hurricane Alex -- had moved ashore into northern Mexico and was causing flooding problems along either side of the Rio Grande, with its associated rains spreading as far north as the Midcontinent.

"Less heat but more storms" was The Weather Channel's succinct summation of the case for overall bearish weekend weather in most of the U.S. and Canada.

After ending a previous one Thursday, PG&E issued a new high-inventory OFO for Saturday (see Transportation Notes), which contributed to general western bearishness. Even forecast highs remaining in the 110 vicinity in the Phoenix metro area were unable to keep San Juan numbers firm.

A Midcontinent producer said unlike a week earlier, when prices were stronger due to some buyers wanting to make storage injection purchases for the holiday weekend, his company could find little industrial demand Friday. Thanks to TD2-related rainfall keeping temperatures moderate, regional power generation demand was light, he said, and plenty of supply was available. It doesn't look like the Midcontinent will get much hotter until after the middle of this week, he said.

Suppliers were "trying to get rid of any length they can" as quite a bit of pipe maintenance is limiting regional transportation capacity, the producer went on. Because of Enogex having some compression problems, his company was unable to take gas to NGPL-TexOk as it often tries to do, he said. He did reported having to make some intraday purchases to keep his gas in balance among the various pipes.

A Midwest utility buyer reported picking up gas for generation load due to Saturday highs predicted to reach the mid to upper 80s. It was a bit tricky, he said, because the utility has had some customer loads going up and down recently, which has posed a challenge in balancing for the weekend. Rain in the area has finally subsided for a few days, he said, which "gives us a little time to dry out."

PG&E's OFO was making spreads to the PG&E citygate from both the San Juan Basin and Alberta production areas get much tighter, making it more difficult to transport gas profitably for the weekend, a western trader said. Although mild weather would dominate on the West Coast, the forecasts called for very hot conditions in the interior West, he said. But obviously it was not getting hot enough to support prices Friday.

Saying they preliminarily anticipate a 50 Bcf injection to be announced in the upcoming U.S. storage report, SunTrust Robinson Humphrey analysts noted that Canadian inventories increased by 14 Bcf to 458 Bcf during the week ending July 2. "Notably, this marks the eleventh consecutive week that Canadian storage injections have been below year-ago levels," the analysts said, adding that Canadian inventories are now 3% below last year and 18% above the five-year average.

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