Frigid

The frigid January weather that gripped the entire nation, particularly the Northeast, is “diminishing the likelihood” of cumulative heating costs for this heating season finishing below last winter’s high levels, the Energy Information Administration (EIA) said in its Short-Term Energy Outlook for February.

The frigid January weather that gripped the entire nation, particularly the Northeast, is “diminishing the likelihood” of cumulative heating costs for this heating season finishing below last winter’s high levels, the Energy Information Administration (EIA) said in its Short-Term Energy Outlook for February.

It was easy to be a natural gas futures bull Tuesday. In addition to another round of frigid forecasts and spiking prices in the cash market, natural gas futures traders had added buying incentive as crude oil prices spiked following a deadly explosion at an Algerian gas liquefaction plant Monday.

Apparently Wednesday’s Iroquois Zone 2 quote of $76 will stand for a while as the spot market’s price record, because Northeast quotes tumbled Thursday about as fast as they had skyrocketed the day before. Conversely, the rest of the market ranged from flat to up nearly half a dollar after having been softer the day before.

While it appears that the East Coast can continue to enjoy warmer than normal temperatures through the fall and early winter, WSI Corp. said colder temperatures are set to move into the Northwest quarter of the United States.

While it appears that the East Coast can continue to enjoy warmer than normal temperatures through the fall and early winter, WSI Corp. said colder temperatures are set to move into the Northwest quarter of the United States.

Spikes of a quarter or more were common at eastern points Thursday morning, as the cold weather that had failed to avert general softness on Wednesday recovered its price-supportive powers in a big way. The shivering Northeast led the way with gains of up to nearly 70 cents at Transco Zone 6 non-NY, although New England points were comparatively somewhat weak. Western upticks tended to be smaller than those in the East, although such markets as Waha, Permian Basin, San Juan Basin and Sumas rose by about 30 cents or more.

With the arrival of a frigid arctic air mass in the East and indications that it will stick around for a while, natural gas consumers should expect “a material increase” from their recent “eye-popping” December and January heating bills, according to UBS Warburg analyst Ron Barone.

The cash market failed to derive much new strength Wednesday from a polar air mass continuing to dominate the weather picture in the northern half of the U.S. from the Rockies eastward and starting to spread into parts of the Southeast, not to mention a soaring screen. Instead, most points ranged from a nickel or so higher to down about 20 cents, with considerably greater declines recorded at Northeast citygates.