Although winter storm conditions were due to persist through Wednesday in the Northeast and Midwest, they had exhausted much of their price-boosting ability in the key northern market areas Tuesday. Production-area numbers continued to rise by modest amounts in most cases, but quotes were mostly flat to as much as 30 cents lower in the Northeast, Midwest and California.

While not as severely cold as the regions to the north, the South is expected to be chillier than normal Wednesday, which helped account for Gulf Coast prices holding up a bit more strongly than those in the market areas. Early morning lows in the 20s are forecast to reach as far south as the Florida border, which prompted Florida Gas Transmission to extend an Overage Alert Day notice into its second day Tuesday (the pipeline does not post OAD notices until the morning of the gas day that they are in effect).

Western temperatures are expected to be around seasonal averages, but with highs reaching only the 30s in some Rocky Mountain areas. That was responsible for moderate firmness at most Rockies/Pacific Northwest points, despite Kern River and Westcoast continuing to report high linepack and/or encouraging drafting of their systems.

After a minuscule 1.5-cent gain Monday, the screen took that back and more Tuesday in a nickel drop. Nymex’s crude oil and unleaded gasoline offerings also softened slightly. But of more interest to gas traders was the rise in the April heating oil contract based largely on this week’s fresh burst of winter in the Northeast and Midwest. Heating oil, up 1.1 cents to $1.4652/gallon for April, represents the chief competitor of natural gas for heating load share in the Northeast.

A Gulf Coast marketer said he would guess that cash prices will be down overall Wednesday since the screen was softer Tuesday and the worst of the Northeast’s snowstorm will be passing. Barring a major intensification of eastern cold, it looks like the market is settling down for another quiet period like the one that lasted through much of February, he said. Some constraints remain on pipelines to the Northeast, he added, but there are no transport issues of any real significance.

Thanks to Monday’s strong launch of the March aftermarket, swing prices were well above first-of-month indexes Tuesday. For instance, the Chicago citygate was more than half a dollar above index, the Southern California border also was more than half a dollar above its bidweek average, and Henry Hub had a premium of more than 30 cents.

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