Weather forecasts, while cooling a bit further in the Midwest and beating a temperature retreat in the Northeast, certainly were still too moderate in most cases to explain small price increases at most locations Wednesday. It could only be concluded that the previous day’s relatively paltry 3.1-cent gain by May futures and storage buyers grabbing at what looked like bargain gas — for now — was behind the mild rally.

Only a few declines of 2-3 cents were left out of overall price movement that ranged from flat to about a dime higher. Nearly all of the gains were in single digits.

Wednesday’s cash market had only mild prior-day screen support, and Thursday’s trading will have to get by on negative guidance as Nymex’s prompt-month contract fell 2 cents after being in mildly positive territory earlier Wednesday (see related story).

Cooling trends were under way in several areas, including the Northeast, Midwest, Rockies and Alberta. However, freezing lows were virtually nonexistent in the North American forecast south of northern Canada, so no substantive increase in heating load was expected.

However, there may have been a slight amount of extra power generation demand for air conditioning load in the South as most sections were expected to peak on either side of 80 Thursday, but that was still rather inconsequential for overall gas demand.

Southern Natural Gas indicated that it was well ahead of the pace from two years ago on refilling storage but lagging well behind last year’s injections. As of last Thursday, Southern said, it had 28.6 Bcf, or 48% of its total 60 Bcf working gas capacity, in inventory. That compared with 36.6 Bcf (61% on April 16, 2009 and 23.6 Bcf (39%) on April 17, 2008.

A Texas-based marketer said he was seeing projections centering around an 82 Bcf storage injection being reported Thursday for the previous week, but found it hard to predict whether that would raise or lower prices. The market is still seeing a high level of injections in the early stages of the refill season, he said, but volumes very well could be falling back in subsequent weeks.

Based on the mild screen weakness and overall mild weather, the marketer predicted that Thursday’s cash prices will be mostly “flat to down a little bit.”

A Northeast marketer said he was “pretty much” sure that storage refills were the only thing driving Wednesday’s modest price gains, because certainly there was little in the weather outlook as a price booster.

The National Weather Service (NWS) predicts below-normal temperatures during the April 26-30 workweek in a large area from eastern New York state through lower South Carolina on the East Coast and extending westward through the upper Southeast and most of the Midwest to the eastern ends of Nebraska, Kansas and Oklahoma. In the agency’s six- to 10-day forecast posted Tuesday afternoon, below-normal readings also are forecast for virtually all of California and Nevada along with most of Arizona and the southwest corner of Utah. NWS looks for above-normal conditions from northeast Washington state through the eastern edge of Montana, extending southward through eastern Idaho and most of Wyoming into northeast Utah and northwest Colorado.

Kyle Cooper of IAF Advisors predicts a 76 Bcf storage injection to be reported for the week ending April 16. Citi Futures Perspective analyst Tim Evans looks for a much larger 90 Bcf build during that period, to be followed by adds of 70 Bcf and 85 Bcf for the weeks ending April 23 and April 30, respectively.

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