Unable to resist the weakness of weather fundamentals any longer, combined with facing the usual demand dropoff over a weekend, swing prices registered double-digit losses at nearly all points Friday. An Overnominations Day declaration for Saturday by Southern California Gas caused the biggest drop of about half a dollar at border-SoCal Gas.

The screen eventually struggled to an expiration-day gain just shy of 4 cents, but its slightly negative position during the morning provided no support for cash, traders said. Rather, it was the further diminution of air conditioning load that has been ongoing since midweek that finally caused the market to crumble after some rather improbable firmness earlier, they said.

As a partial reflection of how much cooling load has disappeared, one forecasting service reported date-specific record lows overnight for a number of Northeast cities, some of which weren’t far above freezing. But it was difficult to realize any heating load from that development because regional temperatures rose into the 70s during the day.

Even the screen-tracking tendency of the intra-Alberta market failed to support prices there, which fell C35-40 cents from Thursday levels, a marketer said.

Some of the smallest losses of about a dime occurred in the Rockies, and the San Juan Basin-Blanco pool barely fell at all. Both markets were moving higher by a time or more near deadline, a western trader said. The screen uptick was too late and too little to have been an influence, she said, “so we can only assume people caught short and didn’t want to stay in a short position over the weekend when hotter weather is due next week.”

Despite Friday’s softness, rebound prospects for this week brightened with the latest six-to-10-day outlook by the National Weather Service. Through next weekend, NWS expect above normal temperatures for the entire U.S. except for the Florida peninsula and the Pacific Northwest.

Early last week while the August futures contract was still trading in the high $2.90s, about 20 cents below the July settlement level, it seemed safe to assume that monthly indexes for August would be falling. Such an assumption may have lost validity by Friday, though, as the screen settled at $3.167, only 1.5 cents below the July number. A marketer reported Henry Hub deals that afternoon at $3.18-20, an advance of slightly over a nickel from the Hub’s $3.12 July index.

After having been taken lower Thursday by futures softness, bidweek numbers were rising a bit again Friday afternoon, once again influenced by screen movement, a couple of sources said. One, reporting border-SoCal basis of plus 60-70 cents Friday and fixed-price deals in the $3.70-80 range, commented that he would “bet we’ll see a border index in the $3.80 area.”

©Copyright 2001 Intelligence Press Inc. All rights reserved. The preceding news report may not be republished or redistributed, in whole or in part, in any form, without prior written consent of Intelligence Press, Inc.