Cash market quotes for weekend and Monday gas swan-dived 17 cents Friday as traders looked forward to Thanksgiving week and forecasts of benign weather conditions in eastern markets.

Northeast locations were hit the hardest, but double-digit losses were also recorded in the East and Rockies. At the close of trading December futures were up 8.7 cents to $3.790 and January had added 8.3 cents to $3.904. December crude oil rose $1.22 to $86.67/bbl.

In the Rocky Mountains the day’s decline had producers thinking the week of Thanksgiving might see still lower prices. “You lose a lot of commercial and industrial demand, and most people take that Friday off, so I don’t think it looks very good for the spot market next week,” said a Rockies producer.

On a bullish note, he suggested that Thursday’s Energy Information Administration inventory figure of an 18 Bcf withdrawal “had some problems. You don’t find firms like Tudor Pickering, First Enercast, and Bentek missing by 10-12 Bcf on that small a number. A lot of guys say there are problems with EIA sampling of these salt caverns in the Producing Region. I think there is some justified skepticism that the number was that low.”

The Rockies are just one region encompassed by forecasts of near-term warmth. Commodity Weather Group in its morning six- to 10-day report shows a very broad band of above-normal temperatures encompassing about three-fourths of the country extending from Arizona and California to Quebec. The East Coast is shown to have normal temperatures, and no section of the country is expected to be below normal.

“Overall, the forecast is same-to-warmer [Friday] for the Midwest and East, although we carry slightly lower confidence today, too, given higher volatility on various model versions,” said Matt Rogers, president of the firm. “There are probably slightly more colder risks yet for the East Coast, but then warmer risks toward the Midcontinent later in the 11-15 as the incoming cold push looks more transient on both European and American ensembles.

“It has a chance to be an event along the lines of this week’s cold push, meaning it could be briefly stronger as it translates through, but it does not seem to lock. After [Thursday] night’s chilly Euro[pean model] weeklies for early-mid December, the latest CFS [Climate Forecast System] arrived much warmer, especially for the Midcontinent. These big differences keep our confidence quite low yet. Our current December outlook is in between these options.”

The producer also noted a hefty increase in nuclear outages. “It looks like there are 9,700 MW more nuclear power offline this year compared to last year. We are talking 11.5 to 2 Bcf per day from these nuclear plants being down.”

According to the NGI NRC Power Reactor Status Report, a total of 31 nuclear plants are either off-line or producing at less than 100% of full power. The 31 nuclear plants’ generation represents a loss of 23,168 MW out of total U.S. capacity of 100,900 MW generated from 104 facilities.

Weekend and Monday gas on CIG was quoted at an average $3.36, down a stout 20 cents, and deliveries to the Cheyenne Hub came in 20 cents lower at $3.39. At Opal, gas traded at $3.44, down by 20 cents, and on Northwest Pipeline Wyoming deliveries came in 19 cents lower at $3.34. Gas on Questar fell 23 cents to $3.30.

Northeast quotes took a dive as forecasters saw little change in the next few days. “With a high-pressure area parking over the Northeast, our weather is likely to be much the same the next few days and shouldn’t change much well into next week,” said AccuWeather.com meteorologist Elliot Abrams.

Weekend and Monday packages at Algonquin Citygate tumbled 88 cents to average $5.51, and gas at Iroquois Waddington slumped 26 cents to $5.18. Deliveries to Tennessee Zone 6 200 L dropped 82 cents to $5.39.

At points farther south, buyers on Tetco M-3 were able to pick up gas 16 cents lower at an average $3.80, and gas on Dominion fell 14 cents to $3.59. Gas destined for New York City on Transco Zone 6 fell 22 cents to $3.77.

The National Weather Service in New York said “high pressure over the Great Lakes will gradually build over the northeast through the weekend. The high will remain over northern New England with a persistent northeast flow through the middle of [this] week. A large storm system is forecast to develop over the western Atlantic but is currently expected to remain offshore as another area of high pressure builds in from the west.”

High temperatures over the weekend and into Monday for New York and Philadelphia were expected to hover right around seasonal averages in the low 50s, according to Wunderground.com.

Futures traders attributed the day’s gains to short-covering and a cadre of cautious sellers concerned about weekend temperatures. “[The] market spiked late session on what appeared to be pre-weekend short-covering while remaining within the confines of this week’s trading range. In other words, seller caution ahead of a weekend that could bring some significant changes to the short term temperature views accommodated today’s [Friday’s] advance,” said Jim Ritterbusch of Ritterbusch and Associates.

“Assuming no significant alteration away from the warming trend that extends out toward month end, we will look for some selling early [this] week that could carry January futures back down toward today’s lows that were just 3 cents above our preferred $3.75 buy region.

“The weakening in natural gas demand that was expected from the coal-to-gas substitution factor has thus far proven less intensive than anticipated. With the market beginning to exit the shoulder period, we look for the short-term temperature views to take on greater importance as deviations from normal will be having a much larger impact on demand than has recently been the case. Our longer-term bullish stance remains predicated on some improvement in the balances at least on a year-over-year comparison basis. The dynamics that we will be monitoring include the gradual easing in production in which output currently appears downsized from the beginning of this year.”

©Copyright 2012Intelligence Press Inc. All rights reserved. The preceding news reportmay not be republished or redistributed, in whole or in part, in anyform, without prior written consent of Intelligence Press, Inc.