A majority of the cash market was able to post moderately higher numbers Wednesday based on what traders said was mostly prior-day screen support, since weather and storage fundamentals remain generally bearish. However, several western points were flat and one segment of Northwest Pipeline plunged a dollar and a half due to a major transportation constraint.

Gains ranged from a couple of cents to about 15 cents and were mostly in single digits. But a price reversal was considered likely Thursday after a plunge in crude oil futures led the natural gas contract at Nymex 8.4 cents lower.

Northwest-South of Green River quotes averaged less than $3.50 and got as low as $3.00 in the second day of the pipeline’s two-day Declared Deficiency Period (see Transportation Notes), with capacity through the Moab (UT) Compressor Station reduced to zero through Thursday from its design level of 355,000 Dth/d. However, since the Deficiency Period will be over Friday, the likely price rebound Thursday gives Northwest-South of Green River a good chance of being one of a few (or maybe only) points that avoid what is expected to be general softness.

Although several western points shared in Wednesday’s overall bullishness, the Southwest basins and Southern California border could manage only flat numbers after SoCalGas declared a high-linepack OFO for Thursday (see Transportation Notes). Other high-linepack issues on western pipes contributed to making the regional market the weakest one Wednesday.

The last time NGI received any quotes any lower than $3.00 was a little more than two years ago. On the trade date of May 5, 2003, CIG, Cheyenne Hub, Northwest-South of Green River and Questar led an overall Rockies dive with low-end quotes of $1.57, $1.50, $2.80 and $1.25 respectively (see Daily GPI, May 6, 2003).

Because the lack of Moab throughput had begun Wednesday, it wasn’t clear why the Northwest segment was so much weaker Wednesday than Tuesday. But one source speculated that the southbound supply backup caused by the station’s outage was increasing in the constraint’s second day.

The screen’s 3-cent rise Tuesday may not have seemed impressive, but there didn’t seem to be much else to explain Wednesday’s upticks, said a Calgary-based producer. He expects softness Thursday, saying people will be looking for a bearish storage number and influenced by the prior-day dive in energy futures (crude oil fell $1.70 to $47.25/bbl after a much larger than expected increase in U.S. inventories was reported by the Department of Energy).

The producer went on to note that the Calgary area was enjoying “nice, pleasant spring weather.” Sometimes it’s gotten snow during May, but it doesn’t look like it this year, he added. A three-day Victoria Day holiday weekend is coming up for many Canadian traders, he said. Those north of the border who have U.S. parent firms will not take off that holiday, he said, but will join the Americans in not working on Memorial Day.

Moderate temperatures remain the watchword for most areas, but Wednesday’s market was not totally devoid of weather support. Thermometer readings are slowly rising in the Southeast, creating slight gains in power generation load, and highs in the 90s and 100s are expected Thursday in the desert Southwest.

It’s getting hotter in Florida, confirmed one of the state’s utility buyers. She hoped that Florida Gas Transmission doesn’t follow through on its warning Wednesday of a “potential” Overage Alert Day notice, adding that she thinks the pipeline sometimes uses such a cautionary warning as a psychological prod to get shippers to put more gas into the system. Observing that it’s only about two weeks away from the start of the Atlantic hurricane season, the buyer said wryly that of course Florida utilities haven’t forgotten what happened there last year.

Reuters said its survey of 19 industry players revealed an average estimate of an 85 Bcf injection for Thursday’s storage report. The range was 73 Bcf to 100 Bcf, the news service said.

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