A little colder weather had a significant impact on gas prices Wednesday as some points in the Northeast and Gulf Coast jumped more than $1. Midcontinent and Midwest markets were up 20-50 cents, and the West also posted gains between a few cents and about 35 cents depending on the location.

However, there were a few weak spots mixed in, particularly in South and East Texas where temperatures remained in the 80s. Houston Ship Channel dropped about a dime. A points or two in the West also slipped a few cents because of continued high linepack on some pipes.

“Cash was up pretty good on average with a cooler weather in the Northeast and Midwest,” said a Texas marketer. Temperatures dropped in the Upper Midwest, northern Midcontinent and parts of the Rockies as much as 30 degrees from Tuesday. New England temps dipped about 12 to 13 degrees. But temperatures across most of the nation are still above normal.

“It’s not really that much colder,” the Texas marketer noted. “We were much less of a seller today than we were yesterday in Chicago. Chicago and Consumers were up about 50 cents today. There must be less Canadian gas coming into the U.S. or something these past two days.

“It’s 83 degrees in Houston right now. Tomorrow it will get back into the 70s again,” he said.

Transco and other pipes bound for the Northeast appeared to post the biggest gains in the Gulf Coast region on Wednesday, with Station 65 up $1.30 or so to the $9.20s. Trading ranges also were wide with Station 65, for example at more than a $1. “People are a little skittish. New York prices were up about $1.20 to the $9.80s. We’re seeing some action but spreads are nothing to write home about,” said a Northeast retail marketer.

He noted that the spread between the Henry Hub and New York still ranged from 35 to 50 cents. “It’s still pretty darn cheap. Remember transport is about 36 cents on Transco. The problem is we’re now heading into the weekend. Even though it’s supposed to be a little cooler we may not see much of a change in demand.”

A New England marketer said the effective degree day was expected to be about 30 Wednesday. “We had latched around a 15-16 degree days for the prior eight or nine days of the month,” he said. “Normal is around 21, so it is cooler than normal. But the name of the game is the market is still long and the pipes are full. Fifty cent basis is no big deal.

“I think the larger trading ranges are because some people got complacent and maybe hit a few bids early thinking that cash prices would continue to suffer under a triumvirate of bearish catalysts. We saw some demand from the LDC crowd today. They must have been looking to balance out some of their sendouts, but I don’t see much additional demand coming in.

“I would expect price action tomorrow to be similar to what we saw today, but think prices will soften for the weekend.”

In the Western market on Wednesday, Pacific Gas & Electric maintained its Stage 2 systemwide high inventory operational flow order with a 5% tolerance. Temperatures came in about 4 degrees above normal Wednesday, but were expected to return to normal levels on Thursday.

Kern River said its linepack is very high on the north end of its system but is low going into the common facilities on the south end of its system. It can’t accept banking on the North nor drafting on the south.

Colorado Interstate Gas continued to note a strained operating condition on its system due to warm weather in its market area. CIG said it does not have the ability to absorb significant imbalances caused by mismatches between scheduled receipts and deliveries or imbalances arising from actual gas flows different than what was scheduled. And because of high storage inventory levels, it will have limited ability to handle storage injections in excess of each storage shippers available daily injection quantity. It asked shipper to adjust flowing supply to avoid penalties.

The weekly storage predictions are ranging between 20 and 60 Bcf. “Our projection of working gas storage injections for the week ending Nov. 4 is 45 Bcf versus 35 Bcf last year,” said Ron Denhardt, energy consultant with Strategic Energy & Economic Research. “Working gas storage is now 119 Bcf below last year but 79 Bcf above the five year average.”

Jay Levine, futures broker with Advest Inc., said he’s expecting a 22 Bcf injection. Tim Evans of Thompson Financial is predicting something in the 40-50 Bcf range. The ICAP storage options auction settled at 42 Bcf Wednesday.

The Gulf Coast region didn’t see nearly the improvement in production that was seen on Tuesday. According to the Minerals Management Service (MMS) production shut-ins due to damage from the hurricanes fell only 90.38 MMcf/d to 4,032.52 MMcf/d. That compares with the 359 MMcf/d drop in shut-in volumes reported on Tuesday by MMS. The agency said four platforms were remanned but 191 platforms and five rigs remained evacuated. Cumulative offshore gas production shut-ins now total 422.410 Bcf, or nearly 12% of annual Gulf gas output.

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