Prices relied on Monday’s return of industrial load after the weekend and perceptions of hotter weather later this week in some locations to realize mostly moderate rebounds from Friday’s plunges. Eastern points tended to range from down a few pennies to 20 cents higher. The West recorded similar movement at some points but also saw even larger gains close to half a dollar at the Southern California border and PG&E citygate and around 30 cents or so in the San Juan Basin.

The California (and indirectly San Juan) strength was in obvious response to SoCalGas and PG&E lifting the high-linepack OFOs (see Transportation Notes) that had stifled weekend numbers, a marketer said. Malin was up nearly 20 cents for her, but she attributed the PG&E citygate’s much bigger advance to “people covering their [OFO-related] short positions from the weekend.” California is still not seeing a lot of weather load at this point, the marketer said. She was hearing forecasts of warmer temperatures approaching in the interior West but downplayed their market impact. “It won’t be anything major, maybe five degrees or a little hotter,” certainly not enough a for big price rally.”

Waha was the rare western point to experience softer prices. A lot of rain is cooling Texas off and diminishing the intrastate air conditioning load that often helps boost Waha numbers during the summer, one trader said. She noted that Houston and Dallas, which saw a string of highs in the low to mid 90s last week, were predicted to reach only the high 80s Monday and Tuesday and not to hit the 90s again before midweek. However, she reported Waha rising above $5.00 late after having started around $4.90 and sinking to the mid $4.80s before rebounding.

Sources in other markets also reported mild upticks in late trading. A Northeast trader who said his late numbers rose a little more than a nickel over previous deals said cool weather in the region certainly wasn’t the reason. “There’s no hot weather forecast for Northeast in next 15 days, so it looks pretty [lousy] for gas load,” he said. However, he added that electric generators had emerged “with good demand,” probably due to prices having fallen so far below first-of-month indexes. The trader also reported hearing that Northeast demand may have gotten a boost from some power plant “test runs” being conducted to make sure the units are ready for later this summer.

A marketer commented on Sumas and domestic gas trading at near parity on Northwest recently, in sharp contrast to multi-dollar premiums commanded by Sumas at times in the last few years: “I think Kemmerer [Compressor Station, a longtime northbound bottleneck on Northwest] will get clogged again this winter and create a new premium for Sumas over domestic, but for now the extra Kern River takeaway capacity” (created for the Rockies by the pipeline’s May 1 expansion start-up) is keeping the points close together. It’s kind of strange to look at Northwest’s bulletin board these days and see that the mobile compressors have been turned off at Kemmerer and that nominations there are well under design capacity, he added.

An NGI source had said Thursday that based on last week’s mild weather, he saw a good chance of the Energy Information Administration reporting yet another record injection volume this week (see Daily GPI, June 13). Analyst Thomas Driscoll of Lehman Brothers agrees, saying Monday he is forecasting a refill of 130 Bcf for the week ended June 13. “Weather-related demand fell in the most recent week (we experienced 24 fewer HDDs [heating degree days] and 13 more CDDs [cooling degree days]) compared to the prior week,” Driscoll continued. His anticipated volume compares with year-ago and five-year average volumes of 81 Bcf and 83 Bcf respectively.

Citigroup’s Kyle Cooper wasn’t quite so sure, saying his final estimation for this week’s EIA report is a build between 119 and 129 Bcf. “Once again, temperatures alone would actually indicate a build slightly larger than last week,” Cooper said. “However, it is quite difficult to predict an increase as physical constraints may come into play.”

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