Most of the cash market emerged from the Labor Day weekend hiatus to discover prices ranging from flat to a little more than a dime higher Tuesday, but the modest firmness was not expected to last after the energy futures complex took a dive.

The West tended to contain all the pricing extremes. Several Rockies points fell into the $0.40s due to the third of three total segment outages on Northwest Pipeline being scheduled for Wednesday. Pacific Northwest points dropped by about a nickel to a dime, but with their averages remaining well above $2, there was a world of difference between the Pacific Northwest and Rockies markets.

Because the Northwest outage prevented a lot of Rockies supply from competing for Wednesday’s California and east-of-California markets, where triple-digit temperatures were starting to spread again, San Juan-Blanco gas saw Tuesday’s biggest gain by far of more than 90 cents into the $2.70s.

A sudden flurry of tropical storm activity after nearly three months of quiet in the 2002 Atlantic hurricane season was turning out to have no significance to the gas market. When they left for the long holiday weekend, traders were wondering if they would return to the office Tuesday and find Hurricane Dolly threatening the Gulf of Mexico production area. Instead, Dolly remained a tropical storm and moved out of the market picture, only to be replaced by Tropical Storm Edouard.

As of 4 p.m. EDT Tuesday, a “poorly organized” Dolly was about 1,035 miles southeast of Bermuda and moving on a northerly course that would take it into colder North Atlantic waters and cause further weakening, the National Weather Service said.

Meanwhile, Edouard was getting weaker as it moved to the west-southwest from about 120 miles east-northeast of Daytona Beach, FL (5 p.m. EDT Tuesday), and was expected to be downgraded to a tropical depression by the time it made a projected Wednesday landfall on the north-central Florida coast.

“We don’t see any threat to production from either tropical storm,” a Northeast utility buyer said. Since cash prices didn’t feel much impact Tuesday from a major downturn in energy futures Tuesday, she expects to see it happen Wednesday. Regional citygates were up about a nickel or so, but between the futures weakness and a cold front due to move in from Canada Wednesday, the buyer didn’t see any chance for avoiding a market dip. “Also, our high temperatures are expected to be close to either side of 80 degrees through a week from now, and that sounds like a recipe for continuing price softness to me.”

A producer noted that Chicago citygates showed little reaction to a falling screen, saying, “Some people said there was some good heat, but the high was only in the 80s. It was a little hotter [than that] on the weekend, so I guess a few traders might have been replenishing storage Tuesday. Chicago will follow the screen tomorrow [Wednesday]. It’s not likely that it could go against the [futures] grain for two days straight.”

A marketer said he was hearing little about either tropical storm, which made them market non-events in his opinion. “It’s real quiet today [Tuesday]. I don’t think anybody wanted to come back after Labor Day.” The weather picture has been fairly benign since about mid-August, he said, so “there’s no way” cash prices can continue to resist low-demand pressures any longer.

With upticks of about a dime or slightly higher, California was one of the stronger markets after the San Juan Basin. A producer observed that PG&E “went all the way from a high-inventory OFO Saturday to projections Tuesday morning of being near its minimum linepack levels” in the next few days. However, California demand didn’t seem all that strong to the producer, which was partially reflected by PG&E revising its projections to indicate linepack being in the middle of its desirable range for a while.

A Calgary-based producer reported hearing that “a lot of people are waiting for a revision of last week’s EIA storage estimate. I have heard a wide range of 45-65 Bcf thus far. I think people are narrowing in on the 50s.”

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