A vast majority of the cash market apparently decided to take it easy Wednesday and await further developments. Mild softness at a few Northeast points and losses between a nickel and 15 cents in San Juan Basin and the Rockies were the only aberrations in an otherwise basically flat price landscape.

The Upper Midwest is seeing most of the nation’s coldest weather currently, which caused several Midcontinent points, especially Northern Natural-demarc and Ventura, to see the lion’s share of Wednesday’s minor gains of 2-4 cents. A marketer said he was starting to see a fair amount of heating load in the South, parts of which had been recording lows in the 30s as recently as early Wednesday. However, the South is due to return to mild conditions today.

Once again the screen mystified several cash traders by remaining several cents in the red throughout the morning only to eke out a tiny half-cent gain by the end of the day, despite major weakness in the crude oil and heating oil contracts after Iraq announced well before Friday’s deadline that it would admit U.N. weapons inspectors. A marketer said he could only guess that someone at Nymex had won or lost a coin flip. More seriously, a western utility buyer suspected that the futures traders were having second thoughts about the storage report upcoming Thursday morning. He reported hearing a wide range of prior estimates for withdrawals from 5 Bcf to 60 Bcf, although most centered around 20-30 Bcf. The important thing, he noted, is that compared with the year-ago injection of 35 Bcf, any withdrawal at all now will seriously increase the new year-on-year storage deficit that the industry now has after being in surplus most of the year.

A Gulf Coast producer reported that transportation spreads to the Northeast marketer “were tight, though most worked.” Texas Eastern M-3 deliveries from the East Louisiana pool were barely wide enough to move the gas, he said. “If you were vigilant, you could shut your capacity off. Transco long-haul almost always works, but the spreads on it were extra close today, just a couple cents away from the variables.”

A Northeast trader lamented that markets were “getting fewer and fewer and even farther between.” Several customers that she usually sells gas to have been lying low recently, either not buying at all or taking much smaller volumes. Temperatures in the region are pretty close to seasonal currently but might get a bit colder towards the weekend, the trader said.

The fuel buyer for a power generator in the Southwest said “we’re trying to keep our units on, but there’s just not enough demand,” adding that the region seemed to have lots of excess generation capacity amid mild weather. Thus after buying San Juan gas early in the high $2.80s, he was astounded when later prices ran as high as the $3.30s in the Blanco pool. “I have no idea where the load was coming from.”

In its forecast for next week’s weekdays (Nov. 18-22), the National Weather Service foresees above normal temperatures for virtually all of the U.S. except its southeastern quadrant. The only section expected to see below normal readings ranges from Alabama through Georgia into the Carolinas and northern Florida.

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