A true shoulder-month sensibility began to assert itself again in the spot gas market Tuesday. Generally mild to seasonal weather across the West and South, forecasts of some moderation of the cold temperatures that opened the week in the Northeast, and the prior-day example of weakening energy futures led to price dips ranging from about a nickel to nearly a quarter.

Weather fundamentals weren’t fading entirely. The Weather Channel forecast predicted a “gusty” cold front moving through the northern Plains and Upper Midwest Wednesday, and said highs in elevated levels of the northern and central Rockies would struggle to get out of the 30s. Generally, however, there is little in the weather outlook to indicate much chance of a price rebound.

A dearth of heating load resulted in the West recording most of Tuesday’s drops of 15 cents or more. PG&E somewhat epitomized the western markets by issuing a high-linepack OFO for Wednesday (see Transportation Notes). However, Kern River said Tuesday that linepack had returned to normal levels systemwide, a day after reporting high linepack in all segments.

Anticipation of a low pull in Thursday’s storage report may be adding to the developing bearish mood. NGI sources pretty much reflected the general range of predictions, with one thinking as low as 30 Bcf while “I would say 50ish” was the reply from another. A Midwestern marketer said that obviously storage withdrawals are dropping as the heating season nears an end, but he perceived them as remaining quite strong in Michigan. Regional weather will be turning more springlike after midweek, he said, which sounds like a good bet on continuing price softness.

“Not a whole lot has changed,” according to one marketer. Several Texas utilities were buying gas for balancing purposes because “it got warmer than they expected over the weekend” and resulted some overburns, he said. He perceived a “very favorable spread from Waha to Katy right now around 35 cents, the widest I’ve seen in quite a while.” But not many people can play the spread because very limited Waha-Katy transport is available to those that don’t already hold such capacity, he said.

All was quiet for a Florida utility buyer, who said “coolish” weather would prevail in the state through the rest of week. It’s “pretty much the same old, same old: almost no heating or cooling load,” she said. Even Florida Gas Transmission is not bothering to warn of potential Overage Alert Day notices, she observed.

“We got some snow on Monday but it’s gone already,” a Northeast trader commented. “A cold front blew in, but it’s not very cold. It will get colder this weekend, but likely not cold enough to bolster prices.”

Obviously it’s too early for any impact to show up yet, but a potentially bullish event was a labor strike Monday that shut down exports from Trinidad’s Atlantic LNG project. A news report said Atlantic is the U.S. market’s biggest supplier of liquefied natural gas, providing about 1 Bcf/d, according to the Energy Information Administration.

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