Moderate softness permeated the cash market Wednesday as the screen turned in a negative performance and weather-related load remained stagnant in the East while fading a bit in the West. Small declines of about a nickel or less (with occasional flatness) were recorded at most points, but a cooldown from recent hot weather generated losses of 10-25 cents or so in much of the West (although that region also had a few points slightly to either side of flat).

The South continues to experience seasonal cooling load, but the Midwest and Northeast market areas remain in no hurry to start turning on their air conditioners. And a long string of daily triple-digit highs in the desert Southwest ended as thermometers there were hitting only the high 90s Wednesday and in forecasts for Thursday.

California saw some of the bigger drops of around 20 cents at the SoCal border and PG&E citygate as the state was awash in gas supplies. A zero-tolerance OFO for Thursday by PG&E (see Transportation Notes) “was the big California price driver,” a marketer told NGI. The situation was serious enough that PG&E also was making intraday nominations cuts Wednesday, he added. (SoCalGas did not issue an Overnominations Day notice.)

Although it is still hot in the desert Southwest, the moderation from 100 degree-plus temperatures in east-of-California markets along with California’s oversupply problem had price repercussions in San Juan/Permian Basin pricing, which fell about 10-15 cents. Thanks to intrastate Texas’ air conditioning demand, Waha fared a little more strongly with only a small decline.

Although no one mentioned “following the screen,” July gas futures provided negative guidance by staying in the red all day and winding up with a daily settlement down 11.7 cents. However, the crude oil and heating oil contracts realized gains based on the report of another decline in U.S. petroleum product inventories and news that OPEC will meet again in July to consider cutting production.

A Midwestern LDC buyer had no deals at all to report, saying afternoon temperatures were around 77 degrees. “I haven’t even had my air conditioning on yet this year,” he said.

And a Florida utility buyer had only a Zone 2 sale on Florida Gas Transmission to quote. “Being in selling mode only tells you how weak our demand is,” the buyer said. “We’d like to have more throughput on our system, but the weather just isn’t there yet.” At least the lack of demand is keeping pipeline restrictions at bay, she said. A Gulf Coast marketer chimed in that Florida has a lot of fuel switchability and cooling rains there this spring have kept cooling load down, “so in-state demand is practically dead.”

The marketer went on to say he thought “we were going to have a more robust market this week, but the weather just isn’t where it would normally be.” But although prices fell overall, he saw some late upticks that he attributed to “a short squeeze” on supplies near deadline. He also explained recent weak numbers on Tennessee’s 500 and 800 Legs as largely due to the pipeline not discounting transport, which has caused into-Tennessee numbers to lag more than a dime below most other Louisiana pipes.

The National Weather Service upgraded a low-pressure system in the eastern Atlantic to Tropical Depression Two, but said Wednesday afternoon it was “losing organization.” The depression, which will get the moniker of Bill if it achieves named storm status, was moving west at 20 mph from a position about 895 miles east-southeast of the Windward Islands (the southern half of the island chain between Puerto Rico and Venezuela).

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