The eastern United States will experience warmer-than-normal temperatures during January and February before a late-winter cold blast brings colder-than-normal temperatures to the region and almost all the rest of the country, according to forecasters at Andover, MA-based WSI Corp. The South Central area will generally be "quite mild" over the next three months, the forecasters said.

Recent behavior of the North Atlantic Oscillation and other atmospheric and oceanic patterns have reinforced a WSI hypothesis that there was a fundamental climate shift in 2008 that will result in weather patterns similar to those of 40-60 years ago, according to WSI Chief Meteorologist Todd Crawford. The deep freeze experienced this month by much of the eastern United States helps to confirm that hypothesis, he said.

"The recent extremely cold pattern in the central and eastern U.S. should moderate a bit as we head deeper into winter, with a more textbook La Nina pattern emerging. The bulk of the cold should retrogress back into the northern Rockies and northern Plains for the remainder of the winter, with milder temperatures becoming established across much of the East."

WSI is forecasting 2,468 gas-weighted heating degree days for the January-March period, 1-2% more than both the 1971-2000 mean values and January-March 2010, Crawford said.

WSI's forecast for both January and February calls for temperatures to average warmer than normal in the East (except Florida) and South Central areas, with colder-than-normal temperatures expected in the North Central and West areas.

"Slightly decreased heating demand in January is expected along a large swath of the country from Texas through the Mid-Atlantic region and north into New York and New England," Energy Securities Analysis Inc. senior analyst Chris Kostas said in a statement issued in conjunction with WSI's outlook. "The relatively mild temperatures will overlay much of the eastern pipeline corridor, including much of the producing region and consuming East, where gas is stored for regional heating demand. As a result, delivered gas prices at Henry Hub and along the East Coast could be relatively soft in January. With colder-than-normal temperatures expected in the Rockies and along the West Coast, however, firm gas prices are expected in the West."

At the same time, "electrical loads in ERCOT [the Electric Reliability Council of Texas], PJM, New York and New England for January will also be softer than normal, given the relatively mild temperature expectations in these regions," Kostas said. "The softer-than-normal power demand should also reduce gas demand for power generation along the East Coast in January."

By February, delivered gas prices at major trading hubs from Texas to New England could be "relatively soft," but it will be a different story on the West Coast, where the extended cold spell should keep gas prices firm, Kostas said.

The season is likely to end on a chilly note, with colder-than-normal temperatures expected everywhere but the Southeast in March, according to WSI. Such widespread cold would bring with it well-above-normal heating demand and a firm finish to heating season gas prices, Kostas said.

"Price spikes at Henry Hub in March have only been associated with dwindling inventories, however, and that isn't expected to occur this year given high inventories to start the winter, strong production associated with new shale gas wells, and only slightly colder-than-normal temperatures overall. Inventories in the consuming West are likely to draw down the most on a relative percentage basis. West Coast gas prices could be very firm to end the winter heating season as a result."

Forecasters at the National Oceanic and Atmospheric Administration (NOAA) see equal chances of normal, above-normal or below-normal temperatures for the Northeast through February (see Daily GPI, Nov. 19). The continuing La Nina event in the equatorial Pacific Ocean will bring above-normal temperatures to a huge area stretching from the Rocky Mountains to the Mid-Atlantic, NOAA said.

WSI is scheduled to issue its next seasonal outlook on Jan. 25.

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