Prices were up at nearly all points Wednesday, and many of the gains tended to be a bit larger than the ones that were generally limited to 2-3 cents or so a day earlier.
Lows in the freezing area have begun surfacing in parts of the Rockies, and an early-season snowstorm was occurring in the Sierras mountain range Wednesday. Overnight lows in the 30s and 40s are spreading in such regions as the Northeast, Rockies, Pacific Northwest and Western Canada, and the previous day’s screen increase provided modest — and brief — support to the cash market.
Only losses of about a nickel at two Iroquois locations in the Northeast deviated from overall pricing that was flat to about 40 cents higher. Increases between about a nickel and a dime were most prevalent.
Nymex traders could manage only one day of support for the cash market, as the November futures contract resumed its downward trek with a loss of 6.8 cents (see related story).
Line 300 quotes in Tennessee’s Zones 5 and 6 have been realizing substantial gains recently in anticipation of the line’s expansion in Susquehanna and Wayne counties in northeastern Pennsylvania. Recently FERC gave the pipeline approval to activate another phase of the expansion (see related story in NGI’s Shale Daily). Line 300 in Zone 5 was way out in front of Wednesday’s overall market advance.
However, although it rose about a nickel after seeing major downturns in the previous two days, prices for Line 300 in Zone 4 are still languishing as it’s the major entry point for an overwhelming amount of Marcellus Shale production. The point averaged a little more than $1.75 — by far the cheapest gas in the entire market — and had a low-end quote of $1.40.
As anticipated, Tropical Storm Philippe was about to make a sharp turn back to the northeast while moving to the northwest 530 south-southeast of Bermuda Wednesday morning. As so many storms in the 2011 Atlantic season have done, Philippe appeared destined to stay out in the open ocean without approaching land.
Some freezing or slightly lower conditions will be showing up in parts of the Rockies Thursday and Friday, including the vicinity of the Opal Plant in Wyoming, according to the AccuWeather.com on Kern River’s bulletin board. Much of the West is in a significant cooldown period, with even the Phoenix area forecast to see peak temperatures sink into the mid 70s Thursday. The Midwest and South continue to enjoy fairly comfortable early-fall conditions.
Despite overnight lows getting into the 40s lately, they’ve been more than compensated by “lovely” daytime weather, said a Midwest marketer. There is no major cold upcoming in her area’s 10-day forecast, she said.
The marketer said her company bought a lot of October baseload, but now is fretting a bit about excess supply in the midst of moderate weather. Because of the light heating demand by clients, it’s buying very little in the daily market “even though the price is really good.” One of the company’s agricultural clients has begun crop drying operations, but due to having a term contract for the harvest season it’s not asking the marketing firm to buy additional gas, she added.
Kyle Cooper of IAF Advisors came in below several other analysts’ estimates in saying he anticipated a 93 Bcf storage injection being reported for the week ending Sept. 30. Credit Suisse’s Stefan Revielle also expects a relatively small build of 94 Bcf.
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