The holiday weekend effect of higher demand loss than usual trumped a minuscule prior-day screen gain and moderately rising power generation load as temperatures began heating up in northern market areas. The result: prices continued to fall at nearly all points Friday.

Not counting a couple of small gains, overall declines ranged from a couple of pennies to about 40 cents.

With its drop of a nickel Friday, the screen provided modest negative guidance for Tuesday’s resumption of daily trading.

The Midwest was already significantly warmer Friday, and a similar but weaker warming trend would commence in the Northeast over the weekend. But obviously the moderate increases in cooling load were insufficient to avert softening prices. It was to be a status quo weekend for the South, with daytime highs in the 80s and 90s and maybe a few 100s in southern Texas, according to The Weather Channel (TWC).

Meanwhile, the Northwest may feel like it is experiencing an early-spring flashback with a vigorous upper-level system taking command of the West, TWC said. By Sunday much of the region would be five to 15 degrees below average with temperatures in the 40s and 50s over the Great Basin and northern half of the Rockies. Mountain snows were possible, TWC said, and by the second half of the weekend the desert Southwest was due to be cooler than the Upper Midwest.

Columbia Gas reinforced indications of storage space tightness by issuing a Critical Day notice for the May 27-30 gas days, saying that based on its storage injection capacity and on forecasted firm service requirements, there would be no excess injection capacity available for nonfirm services during that period.

Most western points averaged less than $5 on May 19 and at times last week, and that’s where all of them except for Waha and the PG&E citygate ended the week. It’s been about a year and a half since they last explored sub-$5 territory — in Nov. 24, 2004 deals for five-day flows over the long Thanksgiving weekend.

The California market apparently was awash in supplies as Pacific Gas & Electric added its own high-linepack OFO to the existing one by SoCalGas, which got extended into a fourth day Saturday (see Transportation Notes). However, the price impact was fairly minimal as both the PG&E citygate and Southern California border fell only a dime or so.

A Midcontinent producer said he thinks the screen, more than heat levels, will determine whether cash numbers are able to rally this week. It’s “a Nymex-driven market” for now, he said.

Bidweek numbers were moving lower, the producer continued. He reported buying one June package on Panhandle Eastern in the high $5.00s Friday but found the available price had come down to $4.83 later in the day. NGPL-TexOk commanded a small premium to index all the way, quoting the point at index plus 0.5-1 cent and having a basis range of minus 44-37 cents. He also said he traded the MichCon citygate at basis of plus 10-14 cents.

There was a lot of gas around facing thin demand, said a Northeast marketer. There was not enough heat yet in the Northeast to offset the bearish effect of a long weekend, he said. His company had already finished with June business, so he didn’t do any new bidweek deals Friday. But as far as the marketer could tell, it was a very quiet bidweek trading day because virtually all traders were in a hurry to finish up and leave for the holiday.

©Copyright 2006Intelligence Press Inc. All rights reserved. The preceding news reportmay not be republished or redistributed, in whole or in part, in anyform, without prior written consent of Intelligence Press, Inc.