Prices kept falling in most cases Wednesday, but the amount of slide was less than Tuesday’s at many points and there were some instances of flat to slightly higher numbers. That raised the possibility of a cash rally Thursday, with high heat levels expected to continue in a lot of areas and following a 30.7-cent screen rebound Wednesday.

The majority declines ranged from 2-3 cents to nearly half a dollar. Once again, the moderately cooler Northeast saw the day’s largest losses, but they were only about half the size of those on Tuesday.

Meanwhile, the still-scorching desert Southwest and inland California, along with high cooling load in the intrastate Texas market, allowed El Paso-Permian and Waha to range from flat to about a nickel higher. They were joined in a modest show of firmness by Northern Natural-demarc.

The Northeast’s drop in temperatures may have removed some power generation load from the overall market, but hot weather was unabated in most other areas (nearly all of the South will record highs in the 90s and 100s Thursday, according to The Weather Channel). Expectations of a relatively low storage build in the 60s Bcf last week also could be a moderately bullish factor in Thursday’s market.

However, another sign of the approach of no injection space left came from Northern Natural Gas, which notified Interruptible Deferred Delivery (IDD) storage customers of limits on what they can do with accounts (see Transportation Notes). However, a Midwest utility buyer didn’t expect to have much trouble with the Northern restrictions. “We don’t use IDD that much,” she said, and the utility also has higher-priority storage services on Northern.

Local highs were approaching the mid 100s Wednesday, the buyer said, but the area was due to get a little cooldown Thursday and into the weekend. The company had gotten “some pretty good” power generation load so far this week, “but not as much as I had hoped,” she said. Maybe the generation customers had found a different fuel source than gas, she speculated.

A western marketer also reported 100-degree-plus highs in his city, but said they would see little if any decline in coming days. He said the futures rebound provided a chance of picking up cash at least a little Thursday, but thought California demand would make more of a difference in whether cash prices rally in the market he trades.

There is still some maintenance being performed on Westcoast plants that is limiting Sumas volumes, but not really that much, the marketer went on. He had expected the Westcoast work to be finished by now, but it was lasting longer than he expected. Aug. 1 is now the approximate completion date, he said. The marketer found Wednesday’s price spreads “kind of disappointing” from Sumas to the Rockies, Sumas to Stanfield and Rockies to Stanfield, which form a kind of triangle on Northwest. “The farther you get from California, the worse your spreads are,” he said.

Global Insight’s Jim Osten looks for a storage increase of 67 Bcf to be reported for the week ending July 14. In light of the national heat wave that began over the weekend and continued into this week — a period that won’t be covered in Thursday’s report — he is making an early projection of a considerably smaller injection of 49 Bcf for the week ending July 21. “Temperatures are increasing further this week, and the National Weather Service is forecasting CDDs [cooling degree days] in all regions to average well above normal,” Osten said in an advisory Wednesday. “Nationwide, CDDs are expected to be 37% higher than usual.”

The Reuters news service poll of 22 industry players found a consensus expectation of a 62 Bcf build. The estimates ranged from 40 Bcf to 73 Bcf, Reuters said.

As anticipated, Tropical Storm Beryl continued to move northward Tuesday, paralleling the East Coast, the National Hurricane Center (NHC) said. It continued to project that Beryl would begin veering to the northeast Thursday and remain well off the coast, which would be provident for the Northeast because a tropical storm’s most damaging winds and rain tend to be heaviest to the north and east sides. It also would help prevent further losses of power generation load if no more cooling rains are added to an already stormy region.

However, Weather 2000 doesn’t quite agree with the NHC. “While official forecasts and computer models quickly whisk Beryl off to the east and out to the North Atlantic, our research has conversely come up with some troubling findings,” the consulting firm said Wednesday. “We believe the high-pressure ridge over New England is being underestimated and its strength and alignment should steer Beryl much closer to the U.S. coastline than is being popularly advertised. Remembering that such storms have multi-mile diameters, we believe Beryl will impact the Northeast coast, particularly with high sea swells, and also that the possibility must remain on the table for Beryl to graze (or even strike) somewhere between eastern Long Island, NY [and the] Cape Cod, MA coastal zone.”

Weather 2000 also observed that Beryl was classified as the second named storm of the 2006 hurricane season on July 19, adding, “In contrast, we had our fifth named storm of the year by this date in 2005, but hadn’t yet had our first named storm in 2004.”

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