Severe winter-like conditions continued to tighten their icy grip Wednesday, but only San Juan/Rockies points were still experiencing rising prices. Perhaps in anticipation of an approaching easing of the harsh weather blanketing Canada and most of the U.S. from the Rockies eastward, most of the cash market fell between about a nickel and 20 cents. Some Northeast citygates saw losses approaching half a dollar, while others rose a dollar or more.

In addition to the perception of weather-related load starting to peak, one source pointed that Tuesday’s screen drop of nearly a dime was having a residual effect on cash. But another trader cautioned that the futures factor could work both ways, meaning that the Nymex recovery of a little more than 7 cents Wednesday could help induce a price rally Thursday.

For a Midcontinent marketer, there was no maybe about it. “Cash will be back up tomorrow [Thursday],” he said. “It’s cold. There’s snow and ice; it took some coworkers two hours to get into work. [We’ve] seen better days. But it’s not bitter cold; the lows are in the 20s.” He noted that “the temperature-sensitive guys” had called for peaking flows for the first time this season.

Some things were certain Wednesday: a major ice storm had descended over most of the South and was expected to be lingering Thursday; parts of the Northeast are due for significant snowfall; and the Midwest will be mostly dry but freezing. However, a modest shift of weather factors in the market was signaled by Northern Natural Gas ending a cold-weather OFO while Sonat initiated one (see Transportation Notes).

The Rocky Mountains region is enduring frigid conditions similar to those in the East; however, as one trader observed, “The rest of the West is fairly mild compared to the rest of the country.” But quite a few of the region’s coal-fired generation plants are down, he added, which kept power prices very strong in the West and perhaps minimized gas price softness.

Transco Zone 6-New York City managed to match its previous day’s high of $7.25, but there were enough much lower quotes in highly volatile trading to bring both NYC and non-NYC averages in Zone 6 down more than 40 cents.

About 100 MMcf/d of South Texas supply is off the market temporarily. Sources had told NGI that they were unaware of any Matagorda Offshore Pipeline System cutbacks on Tuesday, the day the pipeline began a pigging run. However, on Wednesday afternoon MOPS informed shippers that more liquids had come in than the onshore Tivoli (TX) Station could handle, and thus it was taking all receipt and delivery points to zero on the evening cycle for Thursday’s gas day. The action affected deliveries into Florida Gas Transmission, Gulf South and Tejas.

A Gulf Coast source saw the possibility of a little rally Thursday “if the EIA [storage withdrawal] volume is high enough,” but said it probably would be delayed to Friday if it happens because most cash deals get completed before the report comes out. At least Nymex would have plenty of time to react to a big withdrawal figure, he added, “and if it runs up much, I would expect cash to follow on Friday. There will still be plenty of cold weather around then, although probably less than before.”

Calling Wednesday’s market “deathly quiet,” a marketer said it had a lot to do with ongoing problems of low liquidity, which she asserted “are getting worse instead of better.”

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