The winter weather machine was starting to rev up its engines again, with forecasts of lows around freezing or colder extending into most of the South, and the spot market responded with small to moderate increases at a large majority of points Tuesday. The return of industrial load from its greater-than-usual declines over a holiday weekend and Friday’s 7.2-cent uptick by March futures also played supportive roles.
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Tennessee lifted a Critical Day 2 OFO at the start of Wednesday’s gas day, but that afternoon it said that due to colder temperatures and in order to maintain linepack, a Critical Day 1 OFO would become effective Friday until further notice in Zones 0, 1, L and 2 (see the bulletin board for details). Tennessee said it will continue to monitor Zones 3, 4, 5 and 6, and implement an OFO in those zones if necessary. The pipeline ended a force majeure late Tuesday evening at Station 47.
Tennessee issued an OFO Action Alert, effective Tuesday for all LMS-PA, LMS-MA and LMS-PL Balancing Parties with meters in Zones 5 and 6, due to anticipated colder temperatures in its Northeast market area and in order to maintain linepack. See the bulletin board for OFO conditions.
Futures Continue Higher as $5.50 Level is Breached
Backed by the recent stretch of colder weather in a number of high-gas demand regions, traders continued to keep upward pressure on the natural gas futures market on Tuesday as the front-month contract made yet another new high — both outright and on a closing basis — for the bull move that began three months ago.
Due to cold weather predictions, MRT implemented a System Protection Warning (SPW) effective Wednesday until further notice. See the bulletin board for SPW conditions.
As weather in its service territory gets much colder than it was during the last half of November, Northern Natural Gas plans to lift a systemwide System Underrun Limitation (SUL) at the end of Tuesday’s gas day (9 a.m. CST Wednesday). The SUL had been implemented Nov. 10 (see Daily GPI, Nov. 10).
Futures Fall Below $5 Despite 18 Bcf Storage Build
Colder-than-normal conditions in a number of the country’s major gas markets last week resulted in a smaller-than-normal storage injection report. The Energy Information Administration (EIA) reported Thursday morning that 18 Bcf was added to working gas storage for the week ending Oct. 16, well below both last year’s 71 Bcf build for the week and the five-year average injection of 60 Bcf.
EIA: ‘Modest’ Price Boost Next Year
Natural gas prices continued their descent last month, and they could fall below current projections before colder weather swoops in to lend seasonal support, the Energy Information Administration (EIA) observed in its latest Short-Term Energy Outlook, released last Wednesday. Oversupply and a weak economy featured in last month’s statistics, with power generation gains on competitive prices a bright spot for the gas industry.
EIA: 3.5% Production Decline, Modest Price Increase in 2010
Natural gas prices continued their descent last month, and they could fall below current projections before colder weather swoops in to lend seasonal support, the Energy Information Administration (EIA) observed in its latest Short-Term Energy Outlook, released Wednesday. Oversupply and a weak economy featured in last month’s statistics, with power generation gains on competitive prices a bright spot for the gas industry.
Mixed Price Moves See Mostly Near-Flat Quotes
A large majority of the cash market saw little change in pricing Friday as prior-day screen support and forecasts of colder weather in some areas were largely counterbalanced by warming trends in other areas and the usual weekend decline of industrial demand.