Technical factors, short-covering — and oh yeah, a tad of returning cold weather fundamentals — were the most plausible reasons sources could cite for mostly higher weekend prices, despite the usual demand slump for such a trading period. Friday’s firmness was fairly moderate with nearly all points ranging from flat to nearly a dime up; most gains were about a nickel or less.

The technical and short-covering influences had been discussed Thursday as traders pondered how the market could seemingly remain aloof to a preponderance of bearish fundamentals. But although they weren’t expected to be particularly severe, new cold fronts were either arriving or on the way for much of the U.S. Friday outside of parts of the desert Southwest.

A cold snap was due in the Midwest over the weekend, said a marketer quoting Chicago citygates about a nickel higher in the high $2.10s. Also, nighttime temperatures there will get below freezing at night this week, and Alliance Pipeline has a compressor problem keeping some supplies from reaching Chicago, he said. The marketer noted that basis was rising “just a little” for the out-month strips as Nymex continues to firm.

A leak-prompted shutdown of Matagorda Offshore Pipeline System (see Transportation Notes) occurred after cash trading was completed, so it had no impact on Florida Gas Zone 1 prices Friday, a Gulf Coast source said. “We lost a little bit off MOPS but didn’t have much problem with it. We just shifted some other supplies around.” However, he suspected that shippers with larger MOPS-sourced volumes might have scrambled a bit for intraday replacements.

A marketer reported intra-Alberta numbers rising only about C2 cents or so, but the IntercontinentalExchange platform said its Westcoast Station 2 average was slightly more than C10 cents higher. Station 2 still trailed intra-Alberta by about a nickel, but likely had more relative strength Friday because of a windy cold front passing eastward through the Rockies and leaving near-freezing temperatures in its wake.

Strong winds were a major weather condition in much of the West as the weekend began, and their influence was expected to be felt in the nation’s midsection by Sunday. Although weekend temperatures weren’t expected to get severely cold, expectations of exaggerated wind chill factors may have played a part in Friday’s small upticks, a marketer suggested.

The wind posed a new problem Friday at the Opal Plant in Wyoming. Plant operator Williams Field Services reported that due to being buffeted by “extremely high winds…Opal is experiencing some sporadic power outages.” WFS anticipated cutting nominations in the Intraday 2 cycle if the outages continued.

An aggregator who trades the Northeast observed, “People have been talking for weeks and even months about an impending price crash due to high storage levels. I’m starting to wonder if it [crash] will happen at all unless we get another cool summer.” There seems to be some kind of psychological floor around $2.00 at Nymex, he said. He also reported seeing a report that this is likely to be the warmest winter on record in the past 107 years.

A Gulf Coast producer sounded a similar theme: “It is a strange phenomenon — the warmest weather, the biggest storage, and nothing’s dropping the way it should. Well, there must be something going on other than weather. Traders won’t do deals any lower than $2, even with the large storage and warm weather. There may not be as much supply as the bears would have you think.” Shut-ins are probably unlikely, he continued, but it is almost a certainty that there has been little new drilling. The average well size has gone down dramatically in the past five years, so its output gets used up fairly quickly. “So if you stop drilling new wells, in only a month or so you are not producing much at all,” he concluded.

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