The week was officially crowned “weak” on Friday as cash market points across the United States slumped for the sixth consecutive day of trading. News of four developing storm systems in the tropics proved no match for the declines put in by September natural gas futures on the week.

Most cash points on Friday recorded declines of more than a nickel and less than 20 cents as traders showed no real concern that they would be met Monday morning by a monster hurricane moving up the Gulf of Mexico. The futures market kept the bearishness theme rolling on Friday as the September contract declined by another 9.8 cents on the day to $3.238, bringing the week’s total deduction to 43.6 cents.

“The market was really weak all week, but cash came back a little bit at the end on Friday,” said a Midcontinent marketer. “In my opinion, this tells me that futures are overreacting. That little peak of strength could point to a possible rebound next week, but we’ll have to see whether or not that plays out. We are long pipeline capacity everywhere and so the price everywhere is the same. As a result there is no differential between NGPL Midcon and NGPL TexOk. As a result it is very hard to make money. If the marketers can’t expose a differential, they are all going to go belly up.”

While the much-discussed Tropical Depression Two became less organized and was downgraded to just a tropical low-pressure area over the central Atlantic on Friday, forecasters were also monitoring three other systems — one of which could be in the Gulf of Mexico by early next week.

“The team is monitoring four areas stretching from along the Southeast coast of the United States to just west of Africa,” said Alex Sosnowski, a meteorologist with AccuWeather.com. “While the most distant system has the greatest potential to reach tropical storm or hurricane status in the days ahead, two systems closer to home could bring risks of flooding downpours near the Gulf and southern Atlantic coasts into early next week. While unlikely, next week there is a chance that as many as three active, named Atlantic Basin systems exist: Ana, Bill and Claudette.”

The marketer was dismissive of the current storm picture. “The current storm systems in the Atlantic really are of no real concern because factors are not very ripe for strengthening,” he told NGI. “Not much attention is being paid to these storms in trading circles, but it is a reminder of what time of year it is. Sure, these will likely turn out to be harmless, but what about the next batch?”

Some traders were still discussing Thursday morning’s 63 Bcf natural gas storage injection report for the week ending Aug. 7. While the number came in just below most industry estimates, it was much larger than last year’s 51 Bcf build and a five-year average injection of 42 Bcf. A West Coast trader said that with inventories at their current levels, the storage reports are going to become more meaningless with each week that passes.

“With 3,152 Bcf in storage already due to the lack of gas demand, I think we are coming to the point where a smaller than expected injection might not be a reflection of sparse supplies,” he said. “We are physically running out of room to put the stuff. However, it is always dangerous to be ‘too bearish.’ We’re hearing the same old story. ‘Storage is full and the gas now has nowhere to go,’ so everyone is lined up on one the bearish side of the price boat, which can be dangerous. If the sentiment in the market makes a quick turn, watch out, because you know what happens when people overload one side of a boat. It could be violent.”

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