Beginning another transition into the on-again, off-again periods of frigid conditions that have dominated February’s weather pattern, cash prices saw strong double-digit gains at all points Monday. The previous Friday’s 25.5-cent advance by March futures also was supportive, and the return of industrial load from weekend hiatus gave a little extra boost to the physical market.
Gains ranging from about C25 cents (Westcoast Station 2) to nearly 80 cents (Dracut and Tennessee Zone 6) had a few Northeast citygates averaging just above $10 again. The increases were fairly evenly distributed through the various geographic market areas.
Dracut recorded one of Monday’s biggest gains almost certainly due to shippers having to re-source supplies because of a shortfall in Sable Offshore Energy Project production that was reported for Sunday and Monday by Maritimes & Northeast U.S. (see Transportation Notes). Since they both serve the New England market, Tennessee Zone 6 recorded a similar advance because of the scramble of regional buyers for makeup supplies. NGI was unable to determine the extent of Sable’s production loss and whether it was continuing Monday afternoon.
The current blast of cold will be less severe than the preceding one last week, so as of Monday Dominion was the only pipe planning to implement weather-related OFOs (see Transportation Notes).
The South, where moderate temperatures had contributed relatively little heating load in the first half of last week, will have more participation this time as lows at the region’s eastern end are expected to approach the freezing level Tuesday. A winter storm is expanding into the Northeast Tuesday, The Weather Channel (TWC) said. Accumulations of six to 12 inches of snow are likely Tuesday from central New York through northern New England, the forecasting service said, and there should be “a little sleet mixing in from time to time through this region.”
While lows Tuesday will continue to be around freezing or lower in the Rockies and Pacific Northwest, temperatures in much of the West should run a few degrees above average over the next few days, TWC said.
The northern market areas will get a little warmer Wednesday, a Texas-based marketer said, but there should still be enough heating load to keep prices rising Tuesday about as strongly as they did Monday. The further move higher of 4 cents Monday by prompt-month futures will add a bit more firming incentive, he added.
The marketer said his company was getting a fair amount of March business done Monday but there was still a good ways to go. He reported seeing mostly indexed bidweek trading so far. Most March baseload deals throughout the market were getting done at index flat or a slight deficit, he added, but a couple of the weaker exceptions were index minus 8 cents at Opal and index minus 4 cents for Panhandle Eastern. He said Chicago citygate basis was being bid at plus 17 cents and offered at plus 19 cents.
Although some bidweek trading in the region goes on afterward, most Rockies indexes get set on the first day of bidweek, the marketer said. It looks like the Opal index will be around $8.035, he said.
The National Weather Service indicates that the first few days of March will be fairly mild across most of the U.S. In its six- to 10-day forecast posted Sunday afternoon for the March 1-5 period, the agency predicted above-normal temperatures throughout the Lower 48 states except in two areas where it expects normal conditions to prevail: virtually all of Texas except a narrow strip across the northern edge of the Panhandle, along with the southern three-fourths of Oklahoma, the western half of Louisiana, the southwest corner of Arkansas and the southeast corner of New Mexico; and the northern half of Minnesota.
The number of drilling rigs actively searching for gas in the U.S. rose by two to 1,430 during the week ending Feb. 22, according to the Baker Hughes Rotary Rig Count (https://intelligencepress.com/features/bakerhughes/). Both additions were onshore. The new tally is up 1% from a month earlier but down 3% from the year-ago level, Baker Hughes said.
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