Prices continued to fall at nearly all points Thursday as subpar temperatures for late August persisted in most areas and a losing streak by the futures market continued to negatively influence cash numbers.
A couple of flat points in Western Canada and the Rockies were exceptions to overall losses ranging from 2-3 cents to about a quarter. Declines of around a dime or more were most prevalent.
The Energy Information Administration’s report of a 40 Bcf addition to storage during the week ending Aug. 20 was barely above consensus estimates in the high 30s Bcf. Nymex traders obviously were unimpressed as they sent the prompt-month futures contract 5.4 cents lower on the day (see related story).
Hurricane Danielle and Tropical Storm Earl were features of the Atlantic hurricane season Thursday, but neither appeared to be any near-term threat to the Gulf of Mexico (GOM) production area. Danielle, in the ocean’s midsection, was projected to veer to the northeast and stay away from the U.S. and Canadian coasts, and although Earl’s expected tracking could eventually lead it into the GOM, it was still in the eastern Atlantic Thursday. The National Hurricane Center was also monitoring “an area of disturbed weather associated with a tropical wave” that was just off the west coast of Africa Thursday afternoon. It gave that system a 20% chance of becoming a tropical cyclone within the succeeding 48 hours.
A heat spell for much of the West was proving to be brief as The Weather Channel predicted “much cooler temperatures” returning to the Northwest west of the Cascade Mountains, Northern California and coastal California. Generally moderate conditions will remain in effect for most areas, with only a few parts of the South expected to get only slightly above 90 Friday. However, desert Southwest locations such as Phoenix will still be reaching the mid 100s.
IntercontinentalExchange (ICE) noted a near-doubling of Iroquois Zone 2 volumes traded on its online service from 42,600 MMBtu Wednesday to 79,700 MMBtu Thursday, yet the price there dropped nearly a dime. And although ICE saw Houston Ship Channel trading increase from 316,700 MMBtu Wednesday to 422,400 MMBtu Thursday, prices at that point fell a little more than a nickel.
Southern California border prices slipped about a dime, ICE said, but trading volumes on its system there soared from 494,500 MMBtu Wednesday to 654,400 MMBtu Thursday.
ICE reported generally falling September baseload prices, with the MichCon citygate declining from the $4 area Wednesday to around $3.94 Thursday. However, some western points were holding up, ICE said, with the SoCal citygate staying fairly steady at $3.52.
Other than fairly moderate constraints related to excess linepack by Tennessee and Questar (see Transportation Notes), significant transportation restrictions were close to nonexistent.
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