Remained

It’s going on seven years since the bankruptcy of a certain Houston-based energy trading giant, and natural gas marketers have remained true to their renewed faith in physical assets: pipelines and storage. But that’s not to say gas marketing is a sleepy business of merely pushing molecules through pipes and counting dollars.

It’s going on seven years since the bankruptcy of a certain Houston-based energy trading giant, and natural gas marketers have remained true to their renewed faith in physical assets: pipelines and storage. But that’s not to say gas marketing is a sleepy business of merely pushing molecules through pipes and counting dollars.

A Tennessee Gas Pipeline force majeure remained in effect Friday several days after an explosion occurred aboard a commercial diving vessel that was decommissioning a small line off the coast of Louisiana.owned by ANR Pipeline. The blast, which occurred last Tuesday, sent six crew members of the vessel to local hospitals. A U.S. Coast Guard search for a missing seventh crew member was suspended Thursday.

The market remained unable to find enough heating load to keep prices from dropping further at most points Thursday. Anecdotal evidence from one buyer suggested that increased use of storage to supplant new purchases of spot gas by utilities and end-users is part of the reason that prices have been weak for the most part over the past two days in the face of very cold weather returning to many regions. Futures weakness from the day before continued to be a drag on cash numbers.

El Paso, which had warned shippers of a potential Pack Strained Operating Condition (SOC) Nov. 4 and said last Friday the warning remained in effect (see Daily GPI, Nov. 12), made the SOC a reality Monday. It declared a systemwide Pack SOC for the Nov. 13-20 gas days, setting the imbalance tolerance initially at 10% but saying it will reduce the tolerance if conditions do not sufficiently improve. El Paso cited “milder weather than usual for this time of year” as well as a planned outage of its Washington Ranch storage facility that was to have begun Monday and run through Nov. 19. However, due to “extremely high linepack” impacting its system, El Paso said it had delayed the Washington Ranch work to Tuesday through Nov. 20.

The divide in energy markets continued to widen Monday as natural gas futures continued to plummet while crude futures remained firm, leaving some traders to tilt their heads even farther sideways in confusion. The August natural gas contract dropped to a low of $6.320 before inching higher to settle at $6.376, down 28.6 cents on the day.

Mixed price movement returned to the spot market Monday, with gains outweighing losses. Cooling load remained fairly strong across the South and Southwest but was spotty in more northerly market areas. The return of industrial demand from its usual weekend layoff supported cash prices, but the 16.2-cent drop by July futures on Friday provided negative guidance.

As a couple of sources had predicted the day before, the cash market remained close to unchanged Thursday in most cases. Freezing lows forecast for Friday morning in much of the East, even into the Deep South, were augmented by Wednesday’s screen rebound in being responsible for modest gains at a majority of points.

As weather forecasts remained chilly, traders on Tuesday conceded weather-driven natural gas futures price momentum to the bulls as the February contract traded higher for a fourth consecutive session. After carving out a high of $7.600, the prompt month settled at $7.597, up 27.8 cents on the day and $1.363 higher than last Wednesday’s $6.234 close.