Physical natural gas prices rose on average 7 cents in Wednesday’s trading. Eastern points exhibited strength as the bone-chilling cold and snow that raked the Plains headed east; relatively few points experienced losses. Midwest locations were mostly steady. At the close of futures trading April had eased 2.2 cents to $3.434 and May was 2.3 cents lower at $3.481. April crude oil rose 13 cents to end the day at $92.76/bbl.

A Midwest utility buyer said the company escaped most of the brutal blizzards that raked Texas, Oklahoma and Kansas and although gas demand is up, incremental volumes were taken from storage without the need for any kind of peak shaving.

“Life is good in Nebraska right now,” the buyer said. “Temperatures have moderated and our volumes have backed off. February looks like a pretty good month for us. Thursday, Friday and Saturday of last week were our high demand days, but since then we have been under 200,000 Dth/d.”

“We did not have to draw off our LNG plant and were able to draw down storage. Just trying to get that down so we don’t have any rollover at the end of the season. It looks like we’ll have some pretty good loads next week,” he said.

The buyer said that in spite of their expected loads, the company was going light on March index purchases. “We are kind of gun shy because we had such a brutal March last year. Temperatures were quite warm and prices just kept tanking. We don’t want to get overloaded with gas we would have to sell. We just bought a small amount at [March] index and the rest is our baseload gas and storage.”

The recent blockbuster snowstorms in the United States have many people asking when winter will loosen its grip, and the answer is not likely any time soon, according to

“An active storm pattern may stay put in the U.S. for at least a few more weeks, and a major contributing factor to the major winter storms in the U.S. is blocking in the atmosphere,” said “Blocking occurs when warm air masses associated with large areas of high pressure become anchored across Greenland or Eastern Canada. Cold arctic air is forced southward into the U.S. in this pattern. Storms across the U.S. can also be blocked from moving along quickly, causing them to slow and have more impact.”

“Blocking will stick around through March, and the stormy pattern will last through as least the first two weeks of March,” said meteorologist Paul Pastelok. “This means that more storms will have the potential to slow down and produce heavy snow. The Ohio and Tennessee valleys to the East will lie in the active storm path, receiving rounds of snow and rain through the first half of March.”

Gas for delivery Thursday to Northern Natural Gas Ventura added a penny to $3.60 and quotes at Demarcation were up 2 cents at $3.61. At the Chicago Citygates, next-day deliveries were seen at $3.66, unchanged, and on Alliance quotes were also unchanged at $3.65.

Quotes at eastern points rose as the storm that swept through Texas and Oklahoma was forecast to work over the Northeast Wednesday and Thursday. Alex Sosnowski, meteorologist, said the storm, “which unleashed travel-snarling blizzard conditions in the Plains, will swing through the Northeast Wednesday into Thursday. The storm will bring a period of rain on the coast and everything from heavy snow to a wintry mix and rain inland and farther north. The nature of the storm will be very complex in the Northeast, and the form of precipitation may change many times over its history in some locations.”

As intense as the storms may be, temperatures at major metropolitan points were expected to be above normal. said Boston’s Wednesday high of 44 would hold steady Thursday, 3 degrees above normal, and in New York City the high Wednesday of 51 was expected to fall to 47 Thursday, also 3 degrees above its normal seasonal pace.

At the Algonquin Citygates gas for Thursday delivery added 57 cents to $7.76, and at Iroquois Waddington deliveries rose 3 cents to $4.01. On Tennessee Zone 6 200 L parcels for Thursday came in at $7.69, up about 78 cents. On Dominion next-day gas added 6 cents to $3.57, and on Tetco M-3 prices rose 4 cents to $3.77. On Transco Zone 6 into New York gas was quoted at $3.85, 6 cents higher.

Other forecasters echo the outlook. MDA Weather Services in its Wednesday 11- to 15-day report said its forecast “carries a mostly similar theme. High-latitude blocking will remain a key feature through this period, helping to force cold air southward into the U.S.”

Market technicians versed in Elliott Wave and retracement analysis see the risk-reward favoring the short side of the market.

“Natgas has been congesting since this year began; further congestion may well be dead ahead,” said Walter Zimmermann of United ICAP in a weekly letter to clients. “A wave count analysis still suggests greater downside risk than upside potential, and last week’s attempt to rally did hit a brick wall at our $3.335 weekly R2 [resistance].”

Near term, there is room up to the “3.490 area, and intermediate term there is room down to $2.610.” He suggests that those holding long positions “use a decisive break below $3.135 as a protective sell-stop.”

Traders Thursday will have a chance to fire-up their computers in anticipation of the release of weekly storage data. Cash market traders acknowledge that they will typically try to get all their deals done before the release of the data so as to not have to deal with the subsequent volatility. Shortly before and at the release of the Energy Information Administration storage data, large speculative traders may position themselves via their computers to gain from market movements following the report. In some cases the market movement can actually be caused by the computerized trades.

Kyle Cooper of IAF Advisors in Houston calculates a 177 Bcf pull, and Tim Evans of Citi Futures Perspective is looking for a 171 Bcf decline. A Reuters survey of 21 traders and analysts revealed a sample mean of 167 Bcf with a range of 140 Bcf to 179 Bcf, and industry consultant Bentek Energy predicts a 175 Bcf pull. Last year 106 Bcf was withdrawn, and the five-year average is for a withdrawal of 118 Bcf.

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