Hardly any area can claim to be as much as “warm” any more, but generally seasonable temperatures dominating the near- to intermediate-term weather outlook early in the fledgling heating season resulted in dropping prices across the board Friday. The weekend decline of industrial demand and the bearish nature of the previous day’s storage report were additional market depressants.
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Milder Weather Causes Most Points to Fall
A large majority of trading locations were softer Tuesday as more seasonable fall temperatures return to most areas. Even the Midwest, where a cold front will be delivering considerably chillier conditions and snow in some sections at midweek, participated in the overall downturn.
Mostly Near-Flat Quotes Signal Forecast Uncertainties
Is the latter half of January going to be extra-cold (quite bullish) or merely seasonable (somewhat bearish)? A lot of money could be riding on making the best strategic trading choices in such circumstances, and a few traders have indicated that they’re not sure what path to follow.
Prices Still Show Some Resilience Despite Moderate Weather
Cash numbers continued to defy seasonable to cool weather in many regions for the most part as flat to slightly higher prices remained the norm for a second day Wednesday. The previous day’s loss of 8.7 cents by October futures also had limited impact in dampening the market.
Transportation Notes
Pacific Gas & Electric and Southern California Gas did not extend high-linepack OFOs beyond Saturday.
Futures, Moderate Cooling Load Depress Most Cash Points
Prices weakened Tuesday at a large majority of points as more seasonable temperatures returning to the Northeast and parts of the West combined with a prior-day screen slump of 29.2 cents to put a dent in demand that had been building going into the weekend. Flat to higher quotes at several scattered prevented an across the board run of softness.
Weekend Factor Adds to Price Weakness
The cash market had plenty of negative guidance in recording double-digit losses across the board Thursday. The pleasantly seasonable mid-spring conditions that dominate the current weather picture, a lengthy futures slide that continued Thursday, and the usual drop in industrial load that lowers weekend volumes all added to a powerful price depressant.
Prices Boosted by Hotter Weather and Tropical Activity
More seasonable temperatures arriving in the Northeast and Midwest, along with what could be a tropical depression or storm due in the eastern Gulf Friday, provided all the ammunition that bulls needed to carry cash prices higher across the board Wednesday. Gains ranged from about a nickel to 20 cents and were distributed fairly evenly on a geographic basis.