Weak fundamentals and screen guidance drove virtually all points lower Thursday by greater amounts than Wednesday’s losses in nearly all cases, and it’s a virtual certainty that major softness will continue Friday — and very likely through next week.

Several points in the Midcontinent, Rockies and Western Canada were seeing low-end quotes of less than $2 amid declines ranging from just above a nickel to about 45 cents. Flat Sumas quotes into Northwest were the sole exception to the overall drops.

The Energy Information Administration exceeded consensus expectations on either side of 60 Bcf in reporting a storage injection of 65 Bcf for the week ending Aug. 28. The naturally bearish response by Nymex traders was to drive October futures 20.7 cents lower (see related story).

Further cash losses — potentially even larger than Thursday’s — are anticipated Friday as the extra loss of load from the Labor Day weekend works in concert with light weather-related demand and a continuation of negative screen guidance. Accentuating the bearish outlook, several pipes were declaring OFOs or announcing imbalance restrictions starting Friday or Saturday (see Transportation Notes).

There is still a remote chance of Tropical Storm Erika entering the Gulf of Mexico, but the National Hurricane Center said the “poorly organized” system would not be reaching the central Bahamas until Monday morning.

Few locations outside the Texas-desert Southwest area were expected to get above the 80s Friday, and highs in the 70s would be the norm for most of New England and the Midwest, the California coast, the Pacific Northwest and Canada. Some parts of Canada will fail to reach 70, according to the Weather Central forecasting service.

It’s a “really strange market right now,” said a Midcontinent producer, noting that prices in his region were around parity with Henry Hub or only pennies less Thursday. He reported seeing some trading of Henry Hub at $1.80 for the weekend, which would be down about a quarter.

Local weather was very mild Thursday but warming, the producer said; he added, “I do think summer is over.” He wasn’t aware of any OFOs in the Midcontinent “yet,” but would not be surprised to see some once the slightly warmer temperatures dissipate. He considers most producers to be in “survival” mode currently unless they’ve hedged a substantial amount of production and/or have processing income to help their cash flow, “which we’re lucky enough to have!”

A Midwest utility buyer acknowledged that his company is in a very low-demand period, with almost no electrical or cooling load at all. Midcontinent averages weren’t much above $2 Thursday, he said, and he wouldn’t be surprised at all to see them go below $2 for the holiday weekend.

The buyer said he couldn’t summon much pity for producers in the current low-price environment because it was little more than a year ago when prices were around $13 or so. “What goes around comes around,” he commented.

Upper Midwest daytime temperatures were very mild in the 70s and dropping into the 50s at night, a regional marketer said, although her area was due to reach the “big eight-oh” (80-degree area) this weekend. Her company is still buying a little spot gas delivered into MichCon, she said, but has laid off Consumers Energy purchases because it is getting concerned about storage injection limits on that system over the next two months.

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