In a move that surprised some traders because of continuing weak fundamentals, most of the cash market ranged from flat to as much as about a dime higher Wednesday. A few scattered points saw mild softening limited to a nickel or less.

A Northeast source said he couldn’t understand Wednesday’s “little bit of strength,” but said it may have been based on Tuesday’s screen rally, modest as that was in comparison with a considerably bigger decline on Monday. The timing of Northeast price movement didn’t make a lot of sense to him, though; Tuesday’s highs in New York City and Boston were in the mid 70s, and Wednesday’s rose to the mid 80s. But for Thursday, the flow day for which deals were done Wednesday, the two cities are predicted to go back down to the high 70s and mid 70s respectively. So the question is, the source said, is why didn’t prices go up Tuesday when a jump in heat was due the next day, and fall Wednesday when a cool-off was predicted?

A Midwest marketer also was a bit puzzled by gains of up to a nickel in her region because of already-mild weather with another cold front from Canada starting to arrive Wednesday. At least the operative word for the cash market was “mild” firming, she said.

The Weather Channel turned up an interesting forecast: Thursday’s high in Juneau, WI, is expected to be in the mid-60s, while the prediction for Juneau, AK, is in the low 80s.

For a Canadian producer, there was no doubt about it: the screen’s rally on the prior day was the main factor in Wednesday’s small upticks. He dismissed suggestions that the upcoming storage report, in which prior expectations centering around a 90 Bcf injection would fall far short of the year-earlier volume of 127 Bcf, might have sparked a bit of cash bullishness. If such a spread is already factored into expectations, he reasoned, why would the report be a reason for firmness the day before?

The producer noted that weather support is still weak, especially in the northern market areas. “I understand there might even be some heating degree days around Chicago this weekend,” he said, adding that he expects softness to return to the cash market for the rest of the week.

The failure of PG&E to extend a high-linepack OFO had a supportive effect at most western points, which also responded to highs of 90 degrees or more in parts of the Rockies and Pacific Northwest and continuing 100-plus readings in part of the desert Southwest. Malin and the PG&E citygate rose about a nickel and a dime respectively, but the impact was neutral at a flat Southern California border.

July basis is getting crushed, according to a producer who said Chicago basis had slid to minus 2 cents after being reported as flat Tuesday. He was seeing Chicago as index-flat for July.

The Atlantic Basin hurricane season remains quiet. A tropical wave was responsible for some wind and showers in the Lesser Antilles, but no development is expected.

Much of the nation is taking a breather from stifling warmth, but not for long, a Weather 2000 advisory said. The three Hs (hazy, hot and humid) will gradually return to the eastern third of the U.S. as July nears, the consulting firm said. “Hence, expect to see many of the ‘Chicken Little’ cold forecasts you may have seen (outside of the north-central [region]) to be abruptly or slowly retracted over the course of this week.”

©Copyright 2004 Intelligence Press Inc. All rights reserved. The preceding news report may not be republished or redistributed, in whole or in part, in any form, without prior written consent of Intelligence Press, Inc.