Thanks to the one-two punch of a much-below-expectations storage injection report and somewhat premature winter weather that was producing near-blizzard conditions in parts of the Upper Plains and Upper Midwest, spot prices spiked intensely Thursday for gains in excess of 40 cents nearly across the board.

However, the “roller-coaster” characterization of this week’s market by one source Wednesday appears to be still apt. Traders cited several reasons to anticipate a third straight reversal of price direction today: an eventual screen downturn of a little less than a nickel after it had spent some time in positive territory during the morning; late retreats in cash quotes; the usual demand slump of a weekend period; and predictions that much of this week’s severe weather will begin dissipating toward the end of the weekend.

The Northeast saw Thursday’s biggest increases as Transco Zone 6-NYC topped all advances with numbers averaging in the mid $3.70s, up more than 70 cents from Wednesday. While not under the winter storm watches being declared in the Midwest, the Northeast is due to get its share of low thermometer readings through the weekend.

The desert Southwest along with parts of the Rockies constituted about the only region still able to claim really warm temperatures. Although conditions remained mild Thursday morning in the lower reaches of the South, temperatures were due to trend downward into a cold weekend. However, the latest six-to-10-day forecast from the National Weather Service must be heartening for bears. It calls for above normal temperatures blanketing the U.S. from the eastern Rockies to the East Coast starting in the middle of next week.

“This is better than the $1.50s gas we saw at the beginning of the month,” a Midcontinent producer said. Her quotes were uniformly in the $3.00-10 range for Panhandle Eastern, ANR Southwest and NGPL Midcontinent, or nearly twice the price averages for Oct. 2 flow.

However, noting that prices were falling in late trading, the producer had doubts about any continuation of Thursday’s uptrend. With most quotes outside the Rockies and Southwest basins currently above $3, “we’re probably going to have people start flooding the market with storage withdrawals,” she said, adding that she already knew of some people withdrawing storage that had been bought at considerably cheaper levels over the last month or two.

A marketer confirmed that late softening also occurred in the Rockies, but said it was much more pronounced there than in eastern markets. Her Kern River-Opal quotes peaked in the low $2.90s but ended in the mid $2.50s. In an even more extreme example, early Questar deals done in the $2.70s and $2.80s yielded to numbers in the $2.20s near deadline.

Another marketer concurred that “the West definitely crashed harder than the East” in late trading. It’s sure looking like prices will be heading down again for the weekend, she said. “Every day this week has not been just volatile, but more like super-volatile. But I don’t care whether it’s going up big or coming down big; there’s opportunity for making money either way.”

Intra-Alberta prices soared as high as the C$4.10s, one trader reported, but they also went as low as the high C$3.80s.

Referring to the role of AGA’s small-volume storage injection report in Thursday’s hyper-bullishness, a marketer commented, “People are still having a knee-jerk reaction to the numbers they publish, which is surprising since either way there is still more than 3,000 bcf in storage. It is odd; although AGA has lost a lot of credibility, they still have a huge effect on the market.”

The breathtaking nature of Thursday’s swing price spikes may have distracted many traders’ attention from the fact that the November bidweek officially began Thursday. Very little in next-month business was being done other than index and/or basis deals. A producer said discounts from index were getting smaller in the Midcontinent. “Last month we saw Panhandle Eastern trading at index minus cents; now it’s minus 1-2 cents.” A western marketer said that basis appeared to be widening a bit whenever the screen moved up and tightening when it softened. She quoted Waha and El Paso-Permian both trading at index minus 4.5-5 cents.

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