Various sources mentioned the previous day’s spike in petroleum-based futures, continuing cold weather in northern market areas combined with an anticipated winter storm thrust into western reaches of the Southeast, and popular expectations of a 200 Bcf-plus storage withdrawal report as reasons for a moderate rebound in cash prices Tuesday.

There was a bit of continued backsliding at Transco Zone 6-New York City, which nonetheless remained the highest-priced point by a small margin over the Algonquin citygate and the non-NYC pool of Transco Zone 6. Excluding Big Apple deliveries, advances ranged from about a nickel to 30 cents.

A Midcontinent marketer said he’d heard talk about a big storage pull, but for him it was Monday’s crude oil run-up of nearly $2/bbl to nearly $35 that provided the main impetus for the rally in physical gas prices (the crude contract gave back almost a dollar Tuesday but stayed above $34). “I don’t think many people were bullish today [Tuesday] about storage withdrawal expectations, although that may have more effect Wednesday,” he said. Weather also played a role, he added, noting that local media were saying his city was experiencing its highest snowfall since 1960, having already accumulated 21 inches on the ground with up to 8 more inches in the forecast.

A Gulf Coast producer noted that the production area was starting to get cooler again, but he agreed with the marketer that the gas price increases were mostly due to this week’s renewed strength in oil futures. Gas and crude futures “aren’t exactly tied to each other and the connection to physical gas is kind of weak, but today the [gas] screen went with [Monday’s jump in crude futures].”

The producer dismissed talk about the EIA’s estimate of storage withdrawals being above 200 Bcf, saying, “There should be plenty left. We should have more than 1.1 Tcf in the ground at the end of withdrawal season. That will give us a nice base to work on through the shoulder months. Who knows, if it’s a mild summer, we could have conditions like two years ago when gas was much closer to $2.”

“We’re suppose to get an ice storm in the Northeast,” said a regional trader. “More specifically they are calling it a ‘wintry mix.’ It’s a combination of sleet, snow and rain. But no hail. Hail is saved for the summer.” Commenting on high temperatures above freezing for the first time in a couple of weeks, he said, “I tell you that is nice. Just to have our highs break out of the 20s is really refreshing.”

A source in the Upper Midwest was somewhat dubious about the impacts of both weather and storage in Tuesday’s upticks. “It’s chilly and damp, but it just doesn’t feel that cold” with highs in the 30s following an extended period of freezing temperatures, he said. And even if Thursday’s storage report does feature a pull of more than 200 Bcf, the source didn’t see it having much price impact. Midwest utilities aren’t withdrawing nearly as much as they had prior to last week, he said.

An OFO-like restriction on El Paso (see Transportation Notes) seemed to have little market impact. Waha/Permian, San Juan and Southern California gains of about a dime or less were among the day’s smallest.

A utility buyer in Florida said a front was bringing moderately chillier temperatures into the state. Florida Gas Transmission did not issue an Overage Alert Day notice or even warn about the possibility of one as it often does, she observed, but it did inform shippers that linepack was on the low side. Prices rose about 20 cents or so in FGT’s Zones 2 and 3, while Florida citygates were reported in the high $5.80s. The buyer was glad that the early-February market is quiet for the time being, saying it provided a chance to try to clear some things off here desk.

The National Weather Service predicted below normal temperatures for almost the entire United States during the Feb. 9-13 workweek. It expects normal conditions only in the extreme northwestern (Washington state along with the northern tip of Idaho and northwestern Montana) and southeastern (Florida, Georgia and most of Alabama along with the coastal sections of the Carolinas) corners of the nation. No above normal temperatures were in the forecast.

At least one prognosticator looks for more temperature records to fall “as February carries on in January’s footsteps.” According to Weather 2000’s advisory Tuesday, “With single digits…once again diving as far south as Kansas and Missouri, it’s apparent that February will not give up the frigid headlines set forth by January. The groundhog may be right for the wrong reason, but the key point is he’s right. The U.S. saw this spiral first with the cool October, then the volatility in November, then anomalous cold and big snowstorms in December, and then the record arctic cold and more snow in January. And now we’re locked in…You thought we were kidding (or crazy), but just watch these records continue to fall across the nation.”

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