The market continued to see mixed, mostly near-flat price movement but was showing signs of perking up again by following the previous day's losses at a majority of points with moderate gains being prevalent Thursday.
Temperatures were generally on the upswing east of the Rockies, with most of the cooling trends occurring in the West, but the eastern lows still dipping into the 30s and low 40s combined with Wednesday's increase of 6.6 cents by April futures to generate small gains at a modest majority of locations.
Waha led scattered losses of 2-3 cents to about 20 cents; in spite of forecast Friday lows from to a little more than 10 degrees in much of Western Canada, NOVA Inventory Transfer and Empress were behind Waha with the next-biggest declines, primarily due to falling heating load in Eastern Canada and the U.S. Midwest and Northeast. It was no coincidence that the Northeast and Midwest market areas were home to most of the other dropping numbers.
The rest of the market was flat to a little more than a dime higher, but only Agua Dulce and Carthage in Texas along with the Florida citygate reached double-digit gains.
The Energy Information Administration report of a 71 Bcf storage withdrawal during the week ending March 4 was well short of consensus estimates on either side of 80 Bcf. Nymex traders took it as another sign that the most severe winter weather had passed and that heating load is on a downward slide as they pushed prompt-month futures 10 cents lower (see related story).
Somewhat oddly with most of the cooling weather being in the West and Upper Plains, the desert Southwest cities of Tucson and Phoenix in Arizona were expected to easily surpass Florida for the nation's warmest conditions with peak temperatures in the mid 80s predicted for Friday.
Southern thermometer levels continued to seesaw, as Thursday's dip lower was forecast to be followed by a significant rebound in most sections Friday. It will still be on the cold side for the Midwest and Northeast, but certainly not as cold as earlier in the week when higher prices prevailed Monday and Tuesday.
With SoCalGas issuing a belated high-inventory OFO for Thursday and keeping it in effect through Friday (see Transportation Notes), IntercontinentalExchange (ICE) reported that while SoCal citygates were essentially flat, volumes traded for the following day on its online platform took a tremendous plunge from 817,200 MMBtu Wednesday to a mere 334,200 MMBtu Thursday. But the Southern California border rose about 4 cents while its ICE-traded volumes saw relatively little change in dropping from 589,000 MMBtu to 566,800 MMBtu.
Although a maintenance-related cut of 580 MMcf/d in Kern River delivery capacity into the Wheeler Ridge Zone border interconnect with SoCalGas was for Tuesday only, Kern River shippers still seem to be favoring the shift they made to Kramer Junction as a result (see Daily GPI, March 9). Kern River said 563,769 Dth was nominated in the Evening Cycle for Thursday to Kramer Junction, leaving 28,231 Dth available there. But although Wheeler Ridge has returned to full capacity of 885,000 Dth/d for two days now, Thursday's scheduled Evening Cycle volumes there were only 356,014 Dth, leaving 530,986 Dth available.
Noting a week of warmer weather ahead, a Lower Midwest utility buyer said 50 degrees would feel "pretty nice" to area citizens after uncomfortably cold conditions had lingered through the first week of March. She had expected to keep pulling gas from storage fairly heavily but now plans to throttle back a bit on withdrawals. However, the utility must empty its storage accounts over the next couple of months, so its spot gas buying probably will be fairly light for a while, she said.
The buyer said she doesn't think any more major cold snaps will visit the area before late this year, but it still could get another moderate winter storm or two. Local forecasters are currently feeling a little sheepish, she added, because they had predicted a big snowstorm for the beginning of the week, "but it turned out to be pretty much a nonevent."
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