Following major spikes everywhere to open the trading week, the market was mixed Tuesday but dominated by mostly mild softness. A 34.4-cent giveback by December futures Monday proved more influential to cash traders than the prospects of increasing cold weather later this week.

A moderate majority of points recorded drops ranging from 2-3 cents to a little more than 15 cents. The rest of the market was flat to a little more than 15 cents higher. Rockies/Pacific Northwest and a few Midcontinent points tended to see the biggest gains, with Northern Natural’s demarc and Ventura locations near the top of the pack.

It looked as if Wednesday’s cash prices might have modest prior-day screen support after January futures spent a while up a few cents Tuesday, but it was not destined to happen. The prompt-month contract eventually yielded to a loss of 8.6 cents on the day (see related story).

Temperatures will move lower Wednesday — but only by a few degrees — in some areas such as the South and Midwest. Drops will be much more pronounced in the Rockies, with bottom-end readings in the teens, while Alberta will start to see lows below 10 degrees.

However, the key Northeast market will be fairly moderate for a little while longer, with Boston and New York expected to get no lower than the mid to high 40s.

Indicating the growing heating load in its service territory, Northern Natural Gas is ending a System Underrun Limitation that was aimed at combating excess linepack due to low takes (see Transportation Notes).

One source commented that the ending of mild-weather restrictions by MRT, Texas Eastern and Algonquin (see Transportation Notes) are not that meaningful. It will matter more when cold-weather OFOs start appearing, he said.

Because most areas are predicted to get colder as the week goes on, a Texas marketer said he thinks prices will be a little firmer at most points Wednesday, even though the small futures gain won’t be a big factor. He noted that Transco Zone 6-New York started around $4.85 but finished a little over $5 Tuesday; late increases are another indicator that next-day prices likely will be higher.

Despite a high of 18 expected for Thursday in Denver, a Rockies producer said it would be “cold but no major snow” in the near-term Rockies forecast. When it gets especially cold in the region during winter, 1.5 Bcf/d or so “stays home” rather than go somewhere else, which helps boost prices there and in the Midwest, he said.

Obviously, Rockies producers would like to see restoration of full capacity at the Clarington, OH terminus of Rockies Express, which he estimated at 300-500 MMcf/d at the five shut-in delivery points that were inactivated by a rupture near mid-November (see Daily GPI, Nov. 18).

©Copyright 2009Intelligence Press Inc. All rights reserved. The preceding news reportmay not be republished or redistributed, in whole or in part, in anyform, without prior written consent of Intelligence Press, Inc.