The market paused to figuratively catch its breath with a mixed price performance Thursday following three days of climbing quotes in which the gains tended to get substantially larger each day. Various points ranged from almost 30 cents lower to a little more than 30 cents higher.

The West, which currently has the greatest share of genuinely cold weather, claimed all of the biggest price hikes. Western markets got some support from SoCalGas ending a high-linepack OFO Friday. And even though PG&E kept a similar OFO in place for Friday, the PG&E citygate still managed to rise about a dime.

A new record in storage inventories is virtually inevitable after the Energy Information Administration reported an injection of 64 Bcf for the week ending Oct. 15. The existing peak of 3,254 Bcf, reached in late November 2001, is only 21 Bcf above the current level of 3,223 Bcf and is highly likely to be surpassed in next week’s report. The screen traded lower for a while after the EIA announcement, but then recovered in the afternoon to close 7.4 cents higher.

But as many have pointed out, assumptions of full storage to begin the heating season have been factored into the market. One source noted that as far back as two months ago, some traders were anticipating a price crash during October as storage facilities began topping off, eliminating one source of daily gas demand during a shoulder month. However, despite price plunges on recent Fridays, the market has held firm for the most part and it appears increasingly likely that the withdrawal season will begin Nov. 1 without any such crash having materialized, he said.

Based on fundamentals, a Gulf Coast producer expects cash quotes to be “a little softer” Friday because they won’t have nearly as much previous-day screen support as they did earlier in the week. The Northeast is still experiencing seasonable weather with lows in the mid to high 40s, so it’s getting chilly at night, but there’s not a big amount of heating load yet, he said. Market area prices lately have tended to be less volatile than those in the Gulf production area, the producer commented.

“We haven’t bought gas in several days because these prices are horrible,” said a Midwestern marketer. “I’ve never seen the likes of this before.” She said her company has been asking around, “and it seems that almost no one has hedged for the winter months, and maybe some people are taking advantage of that” in pushing prices up. Between high costs for both natural gas and heating oil, a lot of people are going to get hurt this winter, she said. The market is not missing the Gulf of Mexico shut-ins and they don’t seem to be affecting the storage refill, yet prices show little inclination to bow to benign fundamental support up to this point, she added.

But another marketer confessed that he actually is not displeased with such high gas and oil prices. “The higher the better,” he said, because they will force development of new and alternative energy sources that he is excited about and plans to invest in.

The level of offshore shut-ins remained at 1,544.08 MMcf/d for the third straight day, according to Minerals Management Service.

Prices were mostly softer in South Texas and East Texas despite those areas continuing to set heat records for this time of year. However, Waha/Permian Basin gas, beckoned both by heating demand to the west and cooling demand in the intrastate Texas market, rose 10-15 cents or so.

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