This week’s price run-up appeared to be faltering Wednesday as increases got much smaller and a bit more softness crept into the market. There was still plenty of heat to go around for Thursday, but the modest psychological boost of a tropical storm off the Mexican coast apparently was wearing off quickly and some anticipation of the weak-demand holiday weekend may have had quite a few traders backing off purchases in preparation for avoiding positive imbalance penalties.

Flat locations were much more plentiful than a day earlier, and there were a few losses of 3-5 cents or so showing up (as opposed to only one of 3 cents on Tuesday). Otherwise, grains ranged from 2-3 cents to a little more than a dime, with the great majority of them limited to single digits. The Northeast and Rockies tended to garner most of the larger upticks.

August futures had a soft beginning to their tenure as the prompt-month contract, falling 3.9 cents (see related story).

So far this year’s Atlantic tropical activity has featured only low-pressure areas and an occasional tropical wave, but the season’s first tropical storm was christened Arlene Tuesday evening by the National Hurricane Center (NHC). Although Arlene may provide much-needed rain in the far southern end of drought-stricken Texas, it was not expected to impact any offshore gas production along the state’s lower Gulf Coast.

Instead, the storm was still moving slowly with a due-west tracking that was expected to take it ashore in the vicinity of Tampico, Mexico early Thursday, possibly at minimum hurricane strength by then, NHC said.

The Midwest was poised to take a major leap in temperatures Thursday, with Chicago highs predicted to go from the low 70s to the mid 80s. The Northeast outlook was mixed, with modest movements both lower and higher expected, while the South was due to remain static in some sections and realize moderate temperature increases in others (90s peaks would continue to dominate). But despite area highs approaching 100, the Houston Ship Channel saw a gain of less than a nickel.

Like the Midwest, much more heat was forecast in the Rockies, while much of the desert Southwest would continue to scorch and inland California also was heating up substantially. But it was the same old same old for the West Coast into Western Canada: cool to chilly.

Indicating growing demand in the Northeast, Transco added its own restrictions against negative imbalances to Tennessee’s continuing Imbalance Warning in two market-area zones.

Shifting trends in pipeline supplies were in play in western markets. With SoCalGas apparently lifting its latest high-linepack OFO (another high-linepack OFO notice for Thursday did not arrive until late afternoon), Southern California border quotes rose about a nickel. But IntercontinentalExchange (ICE) said border trading on its platform dwindled from 753,100 MMBtu Tuesday to 552,600 MMBtu Wednesday. El Paso said it was experiencing high linepack Wednesday.

On the other hand, Kern River reported being still within target limits but trending toward a low-linepack situation. And Westcoast, which had reported linepack starting to rise above its comfort level a day earlier, said Wednesday linepack was falling lower than desired.

The growing heat should keep prices propped up to some extent Thursday, a Texas-based marketer said, but with almost everybody citing the Fourth of July weekend as one of the lowest demand periods of year, it’s reasonable to expect softness virtually everywhere Friday. However, he noted above-normal temperatures predicted from midweek onward next week almost everywhere in the U.S. except for the northeastern quadrant, so post-holiday rallies are likely.

The marketer said his company had already finished July bidweek trading by Thursday, but he allowed that some others may have still been doing business. He estimated the Chicago citygate index at $4.35.

A Midwest utility buyer said heat was building in her area, with a high around 100 anticipated Thursday. The resultant power generation load, along with refilling storage, were keeping the company busy with gas purchases. It looks like “a long, drawn-out summer” in coping with the Missouri River and Upper Plains flooding, she said, but so far her company had seen no load loss due to flood evacuations.

The buyer said the utility bought all of its July baseload prior to bidweek. She detected little pricing change between then and bidweek, but since the purchases were index-based it was essentially a moot point.

ICE reported July deals on its platform dropping substantially Wednesday. Little change from Tuesday in prices was evident, as ICE’s Wednesday averages of $4.35 at Northern Natural-demarc and $4.28 at NGPL-TexOk were flat.

South Louisiana production apparently dodged a bullet from flooding of the Atchafalaya Basin in mid-May to protect the cities of Baton Rouge and New Orleans from the swollen Mississippi River. A potential quarter Bcf/d of interrupted output was estimated, but losses reported to the state Department of Natural Resources (DNR) peaked at only 31.54 MMcf/d in the first half of June. However, restoration of shut-in gas wells proceeds at a snail’s pace, with DNR saying that as of Monday operators were still reporting 29.17 MMcf/d offline.

Credit Suisse analyst Stefan Revielle anticipates an 83 Bcf storage injection being reported Thursday for the week ending June 24.

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