Heeding forecasts that the cold wave enveloping Canada and much of the U.S. was already about to start receding in some areas, traders followed up Wednesday's across-the-board gains with generally moderate losses at nearly all points Thursday. The previous day's 6.2-cent decline by expiring November futures and expectations of another stout storage build being reported also were negative influences on the cash market Thursday.
A few scattered locations, mostly in the Gulf Coast, were flat to up about a nickel. A large majority of points recorded losses ranging from 2-3 cents to a little more than 35 cents.
Because the transition to November occurs Monday, gas was traded Thursday for the Friday through Sunday flow periods. The inclusion of two weekend days and their accompanying declines of industrial load undoubtedly was a further price depressant for the Thursday market. Deals done Friday to launch the November aftermarket will cover only Monday.
The Energy Information Administration said 71 Bcf was added to storage during the week ending Oct. 21; that was at the low end of consensus analyst expectations in the low to mid 70s Bcf. Some may have been surprised at how eagerly Nymex traders embraced the slightly bullish nature of the report, as they sent December futures, debuting as the new prompt-month contract, 12.7 cents higher (see related story).
Although a storm that had been bedeviling the Midwest earlier had moved on to the Northeast and was due to bring temperatures there significantly lower (Friday's highs in New York City were forecast to drop 14 cents and 16 cents, respectively, from Thursday), it was allowing Midwest mercury readings to rebound following brief dips lower.
As in the Northeast, a cold wave was entering the South Thursday and causing temperatures to slide moderately across much of the region. The effect was to squeeze most of any remaining cooling load into the southeast corner of the nation, prompting Florida Gas Transmission to keep an Overage Alert Day in place through Thursday. But likely due to expectations of the OAD being lifted Friday as more seasonal temperatures enter the Sunshine State, the Florida citygate was Thursday's top loser after recording the biggest gains of the day Tuesday and Wednesday.
The Rockies were due to start topping out in the 70s again at some locations such as Denver, and although a potent storm system seemed to have set up shop in the Pacific Northwest and brought some mountain snows with it, chilling effects on the region's major population centers appeared to be minimal.
Following the demise of former Tropical Storm Richard, the National Hurricane Center (NHC) was monitoring two low-pressure systems and a tropical wave in the Atlantic Thursday. The system about 1,200 miles northwest of the northernmost Cape Verde Islands as of mid-morning was becoming less organized, NHC said, while another about 700 miles south-southeast of Bermuda was encountering environmental conditions more conducive for development. The center accorded them odds of 60% and 30%, respectively, of becoming tropical cyclones within the following 48 hours, but the systems were expected to stay well out to sea.
The tropical wave about 1,000 miles east-southeast of the Windward Islands also was given 30% odds of tropical cyclone development within 48 hours, but appeared to have the best chance of making its way into the Caribbean Sea (and from there potentially the Gulf of Mexico).
PG&E is reviving a system high-inventory OFO Friday, and even though the PG&E citygate had risen 6 cents while the previous OFO was still in effect for Wednesday, it fell by about the same amount Thursday.
Bidweek numbers had continued to creep higher through Wednesday, according to IntercontinentalExchange (ICE). Its El Paso-San Juan (Blanco) numbers that had averaged just under $2.95 Monday got about 8 cents higher, ICE said, although volumes on its online platform were dropping each day. Panhandle Eastern saw a similar progression higher, ICE said, with quotes going from a little less than $3.01 Monday to about $3.08 Wednesday.
Bentek Energy's U.S. Natural Gas Hub Flows chart showed percentage movement of flat to 8% lower in nominated volumes for Thursday at a majority of the 23 trading points covered by the chart. Tennessee Zone 0 (up 83,000 MMBtu to 370,000 MMBtu, or 29%) was followed among the biggest percentage gainers by Niagara (up 20%, albeit on much smaller volumes rising by 10,000 MMBtu to 61,000 MMBtu) and the Chicago citygate, which advanced by 318,000 MMBtu to 2,769,000 MMBtu, or 13%, Bentek said.
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