“Flat” was the word of the day in the gas market Thursday. No point varied by more than a nickel from unchanged, and a large majority of them either showed no change or were up or down by only a penny or two.

Much as had been the case during Tuesday’s mild price rally, the reasons for Thursday’s prices failing to succumb to strongly bearish fundamentals was a bit unclear. A cold front had taken temperatures lower in the Midwest, but they still were above seasonal averages. Snow from New Mexico into the Rockies may have helped bolster western quotes slightly.

Although it eventually wound up more than 4 cents down, moderate firmness by the screen during the morning may have set an example for cash traders, one source suggested. Another thought some buyers likely were continuing to sit on their storage accounts and choosing to purchase new flows instead, and that possibly some storage injection deals may have played a part.

However, an electric utility in the South said it was selling gas, not buying it. “It hasn’t warmed up that much around here yet,” the fuel buyer said.

Florida citygates rose slightly and remained the most expensive market around, even though an LDC buyer in the state was reporting no new purchases. Florida Gas Transmission may have extended its low-linepack restriction again through at least Thursday (with imbalance tolerance loosened further to 15%), she said, but area weather had moderated by enough to eliminate the need for swing gas.

“What’s most surprising to me,” said a Gulf Coast aggregator, “is swing cash still trading above baseload swing swaps. It should be the other way around,” with rest-of-month deals commanding a premium over swing. He reported seeing a couple of six-to-10-day and 11-to-15-day forecasts indicating colder weather through much of the nation, saying that may have helped keep prices from falling Thursday.

For a Houston-based marketer, the key to the present market is the cash-to-screen premium (Henry Hub physical prices averaged nearly 15 cents above the February futures settlement Thursday). “It’s indicative of the number of people who want flowing gas,” he said. “We’re currently seeing some of the largest standard [physical] deliveries ever at Henry Hub. They represent about 1.9 Bcf/d of volume in about 6,000 Nymex contracts.” That’s almost unprecedented, the marketer said. He sees a very good chance of the situation changing today. Citing Thursday’s softening Nymex close and the moderating weather trends, “If cash can hold its premium for the weekend, I’ll be very surprised.”

A marketer in the Midcontinent expects next week’s trading activity to be about as quiet as this one’s was. “I predict that next week there will be more that is not exciting,” he said. “Overall I’m just a tad more bearish than bullish. Prices can’t fall too much more, though. I don’t think we’re going to hit bottom quickly, just a slow grind down to where the fundamentals say it [market] should be.”

Don’t look now, but El Niño may be returning this year. According to an Associated Press story, the federal Climate Prediction Center said Thursday, “The periodic event that can trigger changes in the weather worldwide could return in early spring and affect the United States by late summer.”

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