Flat or near-flat quotes were common in the East while much of the West was racking up some sizeable losses Thursday. Mixed price moves that had been mostly higher the day before became mostly lower as the cash market weighed the potential of Tropical Storm Fay causing offshore shut-ins and prior-day futures support against light cooling load in many areas.

A modest majority of points were flat to nearly 40 cents lower. Gains ranged from 2-3 cents to about 30 cents.

Friday’s cash market will again have positive futures guidance. The storage build of 88 Bcf reported by the Energy Information Administration for the week ending Aug. 15 was near the high end of previous expectations and considerably above consensus expectations in the low 80s Bcf. The report was ostensibly bearish, especially in comparison with a 57 Bcf five-year average injection, but gas traders at Nymex couldn’t resist hitching a ride with the soaring petroleum futures complex and the September natural gas contract was up 17.5 cents at the end of the day (see related story).

The National Hurricane Center’s (NHC) projected tracking for Fay continued to get more potentially ominous for eastern Gulf of Mexico production. On Wednesday NHC had expected Fay, following a leisurely sojourn through much of the Florida Panhandle, to head northwestward into central Alabama. But as of Thursday the agency projected the storm as keeping to a more southerly course through the Panhandle and passing a little to the north of Alabama’s Mobile Bay by Sunday morning.

“I suppose producers’ decisions on whether to start evacuations will depend on whether or not Fay is weakening substantially Friday,” one source said.

Fay showed no signs of weakening for much of Thursday as it loitered just off the northeast Florida coast before finally making its third landfall around 2:30 p.m. EDT. At 5 p.m. EDT the storm’s center was just west of Flagler Beach, FL, and was moving toward the west at nearly 5 mph. Maximum sustained winds were still about 60 mph, NHC said. A tropical storm was issued for Florida’s Gulf Coast from the Suwannee River to Indian Pass.

Part of the West’s overall price weakness stemmed from excess supply issues. Only two days after implementing a low-inventory OFO, PG&E will have a systemwide high-inventory OFO in place Friday (see Transportation Notes). And El Paso said high linepack prompted it to set the probability of declaring either a Strained Operating Condition or Critical Operating Condition to high. El Paso numbers in the San Juan and Permian basins saw some of Thursday’s biggest drops.

The weather picture will change only slightly Friday. The Northeast and Midwest will be in modest warming trends that will mostly raise highs only one to three degrees or so; both regions will continue to peak mostly in the 80s.

Meanwhile, the Rockies will be cooling off a bit while the Pacific Northwest gets warmer. The desert Southwest will remain hot, inland California merely warm, and the California coast mild to cool. Western Canada is feeling rather chilly with Calgary’s highs dropping into the mid to upper 50s.

The western end of the South is starting to get peak temperatures in the low 90s again after being cooled off by rain much of this week. Fay will keep much of the region’s eastern end fairly moderate for a couple of more days, while the midsection is due to see highs in the low 90s — at least until Fay gets there.

A Texas-based marketer said he hadn’t heard of any eastern Gulf evacuations as of late Thursday afternoon. The cash market was a “mixed bag,” he said. Prices were generally trending lower until the storage report came out, and went back up after that, he said, adding that of course most cash trading had been completed by then.

Noting that September futures continued to move higher in after-hours trading, the markketer said it was a pretty safe bet that most eastern points will be higher Friday, although the West might continue to soften. Henry Hub should be trading around $8.15-18 or so Friday, he said, which would be a little more than a dime higher than Thursday. Balance-of-the-month Henry Hub gas was trading about 14 cents behind the screen Thursday afternoon, he noted.

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