With the previous two weeks’ siege of especially cold weather coming to an end in most areas, prices fell at nearly all points Tuesday. The Florida citygate plunged nearly $5 despite Florida Gas Transmission keeping an Overage Alert Day in place. Northeast citygates, which had been averaging above $10 at times last week, were failing to reach the $7 level as they repeated in having most of the largest declines.

The previous day’s drop of 29.5 cents by February futures also played a large part in Tuesday’s softness.

Flat quotes at Stanfield and Malin, along with gains of up to about C20 cents in Western Canada, averted a second straight across-the-board run of price drops. Losses ranged from a couple of pennies to nearly $5; except for the Florida citygate, they peaked at a little more than $1.42.

The cash market will have some support Wednesday after prompt-month gas futures rebounded by 13.7 cents amid overall weakness in Nymex’s energy complex (see related story).

Few if any cold weather-based transportation constraints will remain in effect Wednesday as pipelines continued to shed OFO-like restrictions (see Transportation Notes).

Lows in the teens and 20s were forecast to still permeate most of the Midwest and Northeast through Wednesday, but that would represent generally milder conditions than what the two regions had been experiencing through last week. Chicago could expect a low in the mid 20s, about 10 degrees above its low-end readings for the past couple of days.

Most of the eastern South was still predicted to see lows in the freezing area, but the west-end states such as Louisiana, Texas and Oklahoma are due to stay above freezing Wednesday.

Only the Rockies, Upper Plains and Western Canada will continue to see temperatures sink as low as the 20s or lower in what is otherwise a chilly to cool but relatively moderate West.

A Gulf Coast trader said colder temperatures would return to her North Texas area later in the week but as of Tuesday they were fairly moderate. Even though the week started out with two days of falling prices, she said she was still finding “more market than supply.” After all, it’s still very cold in the Midwest, she noted, and not much milder in the Northeast.

The market needs to see a very big pull in this week’s storage report to keep from tanking, the trader said, because everyone knows that the current weather will result in a much lower volume next week. Despite the drops in heating load, she saw a chance of Tuesday’s screen rise boosting cash “a little bit” Wednesday.

A Midwest marketer said her company was tapering spot gas purchases for customers this week as temperatures were due to keep rising slowly. Her area got more snow at the end of last weekend, she said, but it was still less than expected. It looks like the industry can expect a generally mild last half of January, she said.

The National Weather Service expects above-normal temperatures across the entire northern tier of states during the Jan. 18-22 period, with such conditions expanding southward in the central U.S. into the northern ends of Texas, Louisiana, Mississippi and Alabama. The agency’s six- to 10-day forecast posted Tuesday afternoon looks for below-normal readings only in peninsular Florida and south of a line extending from the northern border of California through central Nevada and most of Arizona into southwestern New Mexico.

Stephen Smith of Stephen Smith Energy Associates said he is projecting a storage draw of 270 Bcf for the week ending Jan. 8, which is up a great deal from his original estimate of 242 Bcf. Strategic Energy & Economic Research analyst Ron Denhardt predicted a 255 Bcf pull.

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