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Most of Market Is Mildly Softer for Weekend
With an occasional small gain mixed in here and there, prices were mostly flat to moderately softer in quiet trading Friday. Virtually all of the losses were in single digits, with a dime drop in Texas Eastern’s East Texas zone the sole exception.
The usual demand slump of a weekend, the screen’s prior-day drop of more than a dime and mild weather along the West Coast and in the southern tier of states were partially offset by freezing low temperatures from the Rockies into the western Midwest, with the system producing the chill slated to move eastward into the Northeast over the weekend.
While the northern market areas were expected to feel a little more of winter’s sting over the weekend, forecasts for the first part of this week call for a return of moderation. However, around midweek a new blast of cold will be developing, particularly along the East Coast from North Carolina northward and in the southwestern quadrant of the U.S.
The Weather 2000 consulting firm continues to challenge those who think there’s no severe cold left in this heating season. Enjoy the recent respite, as “a return of polar air to the nation is right around the corner,” it warned in Friday’s advisory. “Independent of how the next six weeks pan out, we have already clinched one of the coldest and stormiest winter seasons for the nation in decades(!), and our original research continues to point in the direction of a very cold March.”
One Northeast utility buyer said his city was enjoying “relatively nice weather in the 40s” Friday, but could expect to have dropped a little below freezing around Sunday. Last week the utility was running a little more than half of normal gas throughput for this time of year, he added. “We’re trying to give our storage a rest right now,” the buyer added, because current swing prices are cheaper than what he’s seeing shape up for March.
A marketer in the Midwest reported a rainy Friday in her area, but said it was good that at least the precipitation wasn’t snow. She said she had begun gearing up for bidweek but was not yet actively doing any March deals.
Florida Gas Transmission’s cancellation Friday of an OFO-like constraint (see Transportation Notes) left the pipeline grid with no significant transportation issues.
Citigroup analyst Kyle Cooper said his initial estimation for this week’s storage report looks for a withdrawal in the 150s (Bcf). “After the recent withdrawals, our end-of-season outlook has been lowered to below 1,000 Bcf,” Cooper added. “End-of-season inventories near 950 Bcf are considered likely.”
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