Except for an essentially flat Northern California market, cash prices continued to move higher Wednesday. Colder northern weather, including snow in some cases, either setting in already or due later this week was cited as the primary factor sustaining market firmness.

New gains tended to be smallest at around a nickel to 15 cents in most of the West, where temperatures were fairly mild outside of a portion of the desert Southwest still hitting 100-degree or greater highs. Waha, up about a quarter, was a western point that joined the East in advances of 15-35 cents or so.

There was a hint that this week’s rally might have peaked, however. After two days of reporting rising numbers in late deals, traders said prices were tailing off as deadline approached Wednesday. There was a bit of a run-up in the early going, a utility buyer said, but a fallback began after 9:30 CDT. She said Tennessee in South Louisiana went from the $4.70s in initial trading to as high as the low $4.90s, but later retreated back into the $4.80s.

In addition, the new prompt-month December crude oil futures contract fell below $30/bbl in conjunction with a heating oil futures slide after a significant rise in heating oil inventories was reported Wednesday morning.

A cold front moving southward from Canada was due to bring snow to upper New England and upstate New York Wednesday night and Thursday morning. Much of the Plains region was expected to remain unusually warm through Thursday, but another front would have temperatures dropping 20-40 degrees in its wake Friday, according to The Weather Channel.

A Midwest utility buyer said there was a chance of snow in her area by Friday, but she couldn’t understand why prices kept going up “because I’m hearing storage is full” for all practical purposes. Regional highs are still getting to the upper 50s, and that wouldn’t get many furnaces going, the buyer said. “It will be cooler next week, but still just average for this time of year.” She repeated a theme that has been popular this week in trying to rationalize spiking prices in the face of generally weak fundamentals: maybe overdue cash-screen convergence is finally working.

Indeed, a gain of about a quarter at Henry Hub matched up with a nickel screen rise to leave the Hub a little more than 4 cents behind the November futures contract. Also, a few Hub quotes Wednesday surpassed the final futures settlement.

A Texas producer said high temperatures in the state would continue to approach 90 degrees until a cool front comes through Saturday. “You can’t get comfortable with this market,” he observed about recent volatility. “The screen won’t die, even with high storage [injection] estimates. The market just seems to ignore them.”

Malin and the PG&E citygate barely budged above flat as PG&E extended a high-linepack OFO through Thursday (see Transportation Notes). The Southern California border gained five cents as SoCalGas continued to forego an OFO.

For the Oct. 27-31 period, the National Weather Service predicts above normal temperatures for New England and all of the U.S. west of a line from the northern end of Idaho through southeastern Arizona. Excepting New England, New York and eastern Pennsylvania, below normal readings are expected east of a line from northwestern Montana through southwestern New Mexico, NWS said.

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