It had seemed Wednesday that strong energy futures and an anemic storage build would keep cash prices rising at least until the weekend. But an abrupt screen about-face Thursday combined with moderating temperatures in key southern and northern market areas and sent prices lower, generally down between about a nickel and a little more than a dime.

It’s not as hot in the South-Central U.S. as earlier in the week when Reliant HL&P, the Houston-area electric utility, was setting sendout records. And it’s gotten downright cool again in the Midwest and Northeast.

Crude oil futures remained on an uphill track, climbing to well above $35/bbl. But the gas futures contract for October, after reacting bullishly to Wednesday afternoon’s AGA storage injection report, experienced retrenchment that took it as low as $4.89 at one point Thursday. However, the screen staged a modest rally after cash business had been completed and finished the day just below $5. A Houston-based producer was heartened by the late rebound. “Even though the Merc slipped, the $5 area is still a mighty powerful price for gas,” he commented.

Traders saw nothing more than symbolic impact from the event, but a spokesman confirmed that Alliance Pipeline began delivering between 50 MMcf/d and 100 MMcf/d into ANR near Chicago Thursday. The action was part of Alliance’s commissioning and testing procedure that will continue until the line’s official startup scheduled for Oct. 2.

Because it was a test and flows fluctuated during the day, it was impossible to provide an exact volume, the spokesman said, “but we did open the valve today.” Deliveries into ANR will continue for a while, but Chicago volumes will be an on-and-off process between now and Oct. 2, he said. “The objective of this period is to test our system, so we will at some point be shutting off ANR and checking out how well [interconnects with] Midwestern, NGPL, Peoples and NI-Gas are working.” Alliance also eventually will test its link with Vector, which is looking for a Nov. 1 startup, he said.

Thursday’s decline of about a nickel at the Chicago citygate definitely was due to screen softness and cooler regional weather, not to the extra supplies from Alliance, several traders agreed. “I didn’t really see any indication of it [Alliance gas]; nobody was trying to sell me any of it,” a marketer said. There was very little Midwest demand, he added. Two power plants that he usually sells gas currently are not making any purchases, he said.

A Midcontinent producer said field prices and Midwest citygates were rising slightly as the morning proceeded. He reflected the overall market in reducing the Panhandle Eastern-NGPL Midcontinent spread, which had been a little more than a nickel the day before, to about 2 cents by selling into Panhandle early and into NGPL late.

However, a Northeast utility found delivered prices slipping a few cents in late deals. That was chiefly due to futures weakness, the fuel buyer said.

Northwest was Thursday’s rare pipe with prices flat to slightly higher. Sumas had been trading about 50 cents above domestic gas as the week began, but the spread narrowed to about a quarter Thursday. Volumes northbound from the Kemmerer (WY) Station have increased and are relying heavily on displacement, the pipeline said, and it was allowing no off-system balancing between Kemmerer and Sumas. That helping explain why domestic prices rallied a tad.

But Sumas is staying strong because of supply constraints, according to a Calgary marketer. A total maintenance outage continued through Thursday at Westcoast’s Pine River Plant, which had been scheduled to return to 75% capacity, he said. In addition, he estimated about 80 MMcf/d of British Columbia gas is going into Alliance as it continues to build linepack.

California prices fell more than a dime at all three trading points. Transwestern still has capacity-cutting maintenance scheduled through Sunday, one source said, but it seems traders decided its impact on gas volumes wasn’t that significant. November-March basis has stabilized, he went on, pegging the SoCal border at plus 39 and PG&E citygate at plus 60. That’s much lower than during bidweek when the El Paso outage sent California basis to unprecedented heights, but is still very high compared to historical numbers or even prior to the El Paso explosion, the marketer noted.

A tropical wave that had moved to about 300 miles east-northeast of the northern Leeward Islands Thursday afternoon was failing to show the expected signs of development, according to the National Weather Service.

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