There was still quite a bit of heating load left with many Northeast, Midwest, Plains, Rockies and Western Canada locations still bottoming around freezing or lower, including a few cases into the teens, but prior-day futures weakness, the extra depressant on industrial load from a long holiday weekend and further moderation or status quo conditions in the forecast for many areas caused prices to fall at virtually all points Friday.
Flat quotes in a single deal at MRT were the only exceptions to losses ranging from about a nickel to a little more than 20 cents.
Monday’s cash market will have moderate screen support after February gas futures gained 10.3 cents Friday amid softness in the rest of Nymex’s energy futures complex (see related story).
Gross throughput of 7.7 MMcf/d of gas and 850 b/d of oil remained halted Friday following a Wednesday fire at Apache Corp.’s East Cameron 2 processing platform in Louisiana state waters about two miles off the coast of Cameron Parish, company spokesman Bill Mintz said. No date for restoring service had been determined as of Friday, he said. The three personnel on the platform, all employees of Lafayette, LA-based Island Operating Co., were transferred to a hospital where one later died, Apache said.
Virtually all cold weather-related pipeline restrictions had ended by Friday, and Northern Natural Gas and PG&E planned to implement protections against high linepack Saturday (see Transportation Notes).
Above-average temperatures were expected to persist in the Upper Midwest and northern Plains through early this week, The Weather Channel (TWC) said. Warmer-than-average highs also are expected for much of the East, it added.
Heavy rain and thunderstorms would be invading much of the South Saturday, according to TWC, but they were not expected to quell moderate highs in the 50s and 60s in the region.
“Wet” and “windy” will be the weather watchwords for much of the West, especially along the West Coast into the Southwest, as storm after storm moves in over the next few weeks, TWC said, but “fairly mild temperatures will accompany this Pacific onslaught.”
The usual perception of a long holiday weekend meaning traders would exit their offices shortly after lunch Friday apparently was not applicable for many. A Texas-based marketer said it would not be a short day at his company and several other counterparties, and he thought a lot of traders will not be taking off Monday for the Martin Luther King Jr. Day holiday.
The marketer said Friday prices were down several cents overall but the trend was upward towards the end of trading, which often points out the price direction for the subsequent trading day. He noted that weather was mostly mild in the U.S. going into the weekend but should get a little chillier Tuesday and Wednesday in the Northeast this week before warming renews.
There had been a radical change in transportation restrictions from a week earlier when many pipelines were combating negative imbalances because of the cold, he said; now Northern Natural and PG&E are having to deal with high linepack.
A western trader noted that utilities tend to take most federal holidays off, but many in the producing and marketing sectors do not follow suit. He said he and others might experience Baja Path volume cuts on PG&E’s system this week due to Kettleman Compressor Station maintenance from Monday through Thursday. Given the weather forecasts, he saw little chance of a price rally this week.
His area was emerging from a deep freeze but still might get snow Saturday, a Midwest utility buyer said. He reported seeing throughput dropping last week after some local below-zero experiences a week earlier. Although it might not be good for the company’s bottom line, the buyer said he was glad to see the weather moderation “because our staff was getting worn out; it’s a labor-intensive process” coping with severe cold like the utility saw during the week ending Jan. 8.
Generally bearish weather will persist into next weekend, according to The National Weather Service (NWS). In its six- to 10-day forecast for the Jan. 21-25 period, it looks for above-normal temperatures in nearly all of the eastern two-thirds of the U.S. east of a line running generally southeastward from central Montana through much of the northeast quadrant of Texas to the Gulf Coast border of Louisiana-Texas. The greatest divergence below normal is due in the Midwest, which is often the highest-demand market for space heating. NWS predicted below-normal readings south and west of an arc from the southern half of Oregon through eastern New Mexico into the western tip of Texas.
SunTrust Robinson Humphrey analysts said they anticipate a 210-220 Bcf storage withdrawal being reported for the week ending Jan. 15, which would be above last year’s 176 Bcf pull and the 133 Bcf five-year average.
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