Prices continued to fall by greater amounts Monday than they had entering the weekend, with forecasts of low temperatures in much of the East falling short of what was expected and the previous Friday’s 15-cent drop by November futures being an extra depressant on cash numbers. The return of industrial load from its usual weekend hiatus apparently had no impact on the physical market.
Losses were spread pretty evenly among geographical areas in ranging from about 20 cents to half a dollar.
The cash market will continue to have significantly negative futures guidance Tuesday after the prompt-month contract fell another 27.4 cents (see related story).
Although much of the East was predicted to see below-normal temperatures this week, the overall heating load effect was relatively minimal as much of the South was still forecast to reach the 70s Tuesday while highs in the Midwest and Northwest weren’t expected to get lower than around 60 in most locations.
Other than some sub-freezing lows in the Rockies and Western Canada, moderate conditions were expected to remain in much of the West.
After tracking a couple of tropical systems late last week in the southwestern Caribbean Sea and the Bahamas, the National Hurricane Center said it had nothing on its Atlantic radar Monday.
It was rather significant that many Rockies points were trading in the vicinity of Henry Hub prices or not much lower, while the Pacific Northwest locations of Kingsgate, Sumas and Stanfield handily exceeded Hub numbers.
A Gulf Coast producer expected the screen weakness to keep cash prices moving lower again Tuesday.
Bidweek was getting under way very slowly Monday, he said; there was “just fringe buying by customers” because near-full storage was constraining their demand. He reported doing November deals into Tennessee Zone 0 at index plus 0.5-1 cent, and at basis of Transco Station 30 minus 8 cents and Columbia Gas plus 18 cents.
A Houston-based marketer also said bidweek was slow in getting going. He said the Chicago citygate was trading at index flat for November, while basis was plus 28-29 cents.
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