As a marketer had anticipated a day earlier, cash prices capped a week of solid advances Friday by recording increases throughout the market. A bit of extra chill was due in the Midwest and Rockies over the weekend, but otherwise forecasts remained about as benign for gas demand as they were earlier in the week. Industrial load’s weekend decline obviously had little impact.

Gains remained remarkably well balanced in all regions as they ranged from about a nickel to nearly 45 cents. Only Texas Eastern-East Texas and Questar failed to record double-digit upticks.

Another big gain of 19.4 cents on Thursday by June futures obviously helped propel Friday’s sustained strength in the physical market. The big question: was it also a response to slight improvements in the economic outlook in the past week that may prove to have been exaggerated; the result of massive rig laydowns since last fall finally having significant impact on the supply-demand balance; or a confluence of other factors more difficult to define?

The Midwest was one of the rare areas expected to get colder in some sections over the weekend, but citygates and Midcontinent prices were approximately equal with those in other areas. Some instances of cooling demand would be falling in the South, with both Memphis, TN, and Little Rock, AR, expected to drop from peaks in the mid 80s Friday to the mid 70s Saturday.

The Northeast would be a bit warmer than usual, with highs in the lower 80s forecast for Saturday. And some sections of the South were due to start creeping into the upper 80s with the accompanying increase in air conditioning load. Otherwise, typical May shoulder-month weather remained the overall norm.

The Florida citygate again recorded the biggest price gain Friday and remained well above all other points in the mid $5.30s as Florida Gas Transmission extended an Overage Alert into its seventh consecutive day.

“The commodity funds are back in the [futures] game,” and that impacts cash, a Rockies producer said in explaining last week’s cash market strength in the face of light weather-based load. He was dubious about rising prices continuing much longer, saying storage builds in coming weeks should continue to handily exceed comparable historic volumes. The producer recalled that an outage of the 900 MMcf/d Independence Hub in the Gulf of Mexico started around the second week of April in 2008 and lasted until near the end of June; that reduction of potential storage injections isn’t going to happen again this year, he said.

Basically, there was “no fundamental reason” for last week’s constant upward movement in prices, he said.

Noting the highs around 100 degrees or so in the Southwest last week, a regional utility buyer said that doesn’t usually occur until mid-May or later, but it was happening a little bit earlier this year. It was due to be a hot weekend throughout the southern half of the West into interior California, he said. Several outages of nuclear and coal power plants in the region are currently enhancing the demand for gas-fired generation, but the other plants are due to come back on-line in the latter half of the month, he said.

The hot season is already under way in the Southwest, the buyer said, and the region is unlikely to see any mild temperatures again until mid-September at the earliest. Commenting on speculation that improving economic news may have helped boost cash prices last week, he said he was not convinced of an economic turnaround yet, but was “hoping.”

After falling by just one rig in the previous week, the decline of drilling rigs actively seeking natural gas in the U.S. accelerated again during the week ending May 8, according to the Baker Hughes Rotary Rig Count (https://intelligencepress.com/features/bakerhughes/). Baker Hughes said a net 11 rigs quit the search last week, bringing the active total down to 730. The Gulf of Mexico added a rig for the second consecutive week, but 12 were deactivated onshore, Baker Hughes said. Its latest tally is down 8% from a month earlier and a whopping 51% lower than at this time last year.

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