This week’s mighty price rally, spurred by blasts of colder weather than anticipated in many areas, appeared to have stalled Wednesday as most points were flat to a little more than a dime lower and Northeast citygates plunged almost as fast as they had run up earlier (several fell by about a dollar or so, and the Algonquin citygate was down more than a dollar and a half).

The general leveling off had been presaged by a source’s report of late declines in cash numbers Tuesday. Also, there was some feeling that prices had squeezed about as much support as they could out of the current cold spell.

However, yet another significant screen gain coupled with continuing cold from the East Coast through the Midwest and into the Rockies had some seeing potential for the rally catching its second wind Thursday. Nothing like the spikes of Monday and Tuesday was expected to return, but a couple of traders said there was a good chance of mild rebounds.

January futures extended their rising streak with a 17.7-cent advance Wednesday, and that was accompanied by moderate strength elsewhere in the energy futures complex. Crude oil didn’t gain all that much, but did manage to surpass the $31/bbl level by a dime.

One thing that should contribute to increased demand is anticipated ice storms Thursday in parts of the Mid-Atlantic. According to The Weather Channel’s web site, sub-freezing air along the east side of the Appalachians will mix with moisture sweeping northeastward to produce freezing rain over the western Carolinas, southwestern Virginia and southeastern West Virginia.

There was also talk of a potential nor’easter hitting the Northeast this weekend, but traders weren’t certain how much stock to put in that eventuality. A Gulf Coast marketer said he’d heard that the Northeast was due for a warm-up starting around Sunday, and a utility buyer reported having heard about the nor’easter but added that some forecasters were “pooh-poohing the idea.” A third source said he understood it was “hit or miss” on whether there actually would be blizzard-like conditions in the region.

But count New York City-based Weather 2000 as among the believers. “…a sizeable winter storm is developing for the end of this week and into the weekend for the Northeast quadrant of the nation, and 10 miles can be the difference between rain, snow, freezing rain or sleet,” the consulting firm said in its Wednesday advisory.

Two ruptures near each other earlier this week knocked out 800 MMcf/d of capacity in a 36-inch segment of NOVA in northern Alberta (see Transportation Notes). However, sources stressed that this did not equate to the same amount of supply being knocked off the market. A Calgary-based trader estimated that with re-sourcing and diversions going on, only about 300 MMcf/d of supply was actually affected for an unknown period. He was unable to discern any impact on Alliance deliveries in Chicago.

A producer said his company was “not feeling it too bad” from the ruptures. It redirected some of its affected gas onto Alliance, he said, and its total supply shortfall was about 30 MMcf/d. Noting that NOVA has not determined the cause of the ruptures, he said it was “a pretty old section” of the system and thus the ruptures likely were due to deterioration of the pipe.

A lot of people seemed long on supply in the Chicago area, one trader said. She also observed that the Chicago citygate “has no real spread” from Henry Hub this month. Chicago was about 15 cents higher last month, and now it’s about even with or slightly less than the Hub, she added. Freezing Midwest temperatures are fairly normal for this time of year, and the area should get warmer in the first part of next week before turning “really cold” toward the middle of December.

PG&E citygates had seemed resistant Tuesday to the utility’s high-linepack OFO, recording a gain of 29 cents that day, but with the OFO going into a second day (see Transportation Notes), the gate saw one of Wednesday’s largest non-Northeast declines, dropping about 12 cents.

A producer reporting freezing weather and snow in Calgary Wednesday said intra-Alberta prices are looking much stronger next month. Aeco is currently trading in the mid C$5.50s now but around C6.20 for January, he said.

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