An expiration-day screen dive of more than 30 cents and light heating demand because of mild weather were chiefly responsible for falling prices across the board Thursday. Of course, the long-established conditions of a major storage surplus and the absence of a major hurricane threat to Gulf of Mexico production in a rapidly waning hurricane season also acted as a drag on the market.

Due to the weekend transition into a new month, Thursday’s trading was done for two-day flows through Saturday. Friday’s prices will be reported for Sunday-Monday flows. The fact that a weekend day, when industrial load typically goes on hiatus, was involved added another negative price factor to the market.

It was highly likely that some heating load was developing from a cold front that had already entered the Midwest and was spreading into the Northeast and much of the South Thursday. But Thursday’s price softness made it obvious that the fresh demand was not enough to make up for the near-total disappearance of cooling load outside of the desert Southwest, where the Phoenix forecast called for a continuation Friday of highs just above 100 degrees. Except in Texas, peak temperatures in the South were not expected to exceed the 70s, and the region’s eastern end would struggle to get above the high 60s.

The Energy Information Administration’s report of a 77 Bcf storage injection for the week ending Sept. 22 fell short of consensus estimates centered around the mid 80s Bcf, but it failed to put a dent in the bearish mood at Nymex. November futures dropped 27.7 cents to $5.392 in their debut as the prompt-month contract.

Western and Gulf Coast numbers were further depressed by PG&E expanding a customer-specific high-inventory OFO into a systemwide one and Southern Natural Gas declaring an OFO for long imbalances (see Transportation Notes).

An Upper Midwest marketer said it was getting cold enough that she might have to turn on the furnace when she got home Thursday evening (Detroit was due to see a high in the mid 50s and a low in the mid 40s Friday). It would be the first time this season that she fired it up it on purpose, the marketer said, adding that the furnace lit up last weekend but only because she erred in setting the thermostat. Probably others in the region have already felt the need for some heating, she believed.

“We like that [futures] settlement price,” the marketer said of October futures closing out at nearly a four-year low for a prompt-month contract. She reported October basis of plus 7 cents for Consumers Energy and plus 4 cents for MichCon. The company is going into the new month a bit “skinny” on supply this time because it got burned a month earlier by buying more baseload than necessary and then saw daily prices mostly falling.

A Northeast utility buyer perceived a routine bidweek, saying his company only purchased a little baseload for October because it’s pretty well set already on storage. If it gets cold enough, “we’ll pick up more gas” in the daily market, which could be super-weak if generally moderate to merely cool weather persists in most areas and no tropical storms or hurricanes make it into the Gulf, he said. It’s kind of chilly right now with overnight lows in the 40s, the buyer added, but not chilly enough for a significant amount of furnace usage.

A tropical depression was christened Tropical Storm Isaac Thursday, but it is almost certain to be another nonevent for the gas industry. Like many of its predecessors this year, Isaac (about 665 miles east-southeast of Bermuda and moving to the northwest as of late morning) was expected to turn first toward the north and then to the northeast before fizzling out in the North Atlantic.

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