Cash quotes overall averaged about 2 cents higher Monday as East and Northeast points were forecast to endure a slight warming but other areas of the country such as the Midcontinent saw nominal price changes. Futures markets seemed little fazed by the building Tropical Storm Isaac and at the close September had shed 4.9 cents to $2.653 and October had dropped 6.1 cents to $2.673. October crude oil fell 68 cents to $95.47/bbl.
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Coal-to-gas switching, increased power generation use, a slight uptick in industrial demand and a few gas field shut ins have helped a bit to reduce U.S. gas storage levels, but unless weekly storage injections remain below 2 Bcf/d through the rest of the injection season, some energy analysts think maximum levels will be reached by mid September.
Xcel Energy’s Colorado combination utility recently announced decreases in its second quarter natural gas utility bills, along with a slight decrease for its electric utility bills. Xcel’s utility filed its gas cost adjustment and electric commodity adjustment with the Colorado Public Utilities Commission March 15, calling for gas bill decreases of 13-15% for residential and small business customers, compared to the second quarter last year. The yearly comparisons recognize the seasonal nature of gas use. Electric bills for the same residential and small business customers will decrease slightly less than 1% (0.7%) compared to the first quarter this year and up to 7% less than a year earlier. Residential customers using 40 therms paid 44.5 cent/therm last year in the second quarter ($33.83/month) and will pay 33.03 cents/therm this year in the second quarter ($29.27/month).
Prices continued to fall at a large majority of points Friday despite a few slight reversals of cooling trends. The overall diminution of air conditioning load from earlier in the week was still largely in place, and it was abetted by the previous day’s 8.4-cent decline by August futures following a bearish storage report and the usual drop of industrial load during a weekend in pushing cash numbers lower.
Monday’s slight firmness in the face of still-mild weather in most areas likely was due in part to traders looking down the road a bit and seeing forecasts of colder temperatures. With the change to more bullish weather influences drawing closer, traders pushed all but one point higher Tuesday.
Spokane, WA-based Avista Utilities faces changes for two rate credits in its purchased gas and power mechanisms that could result in slight increases for fuel purchasing costs, effective Nov. 1. A purchased gas cost adjustment and a power credit with Bonneville Power Administration (BPA) emerged following rate hikes approved by the Idaho Public Utilities Commission, which allows retail power charges to increase by 9.25% over three years and natural gas retail charges to rise 2.6% over two years. An initial power rate increase of 3.59% and a natural gas hike of 1.9% went into effect Oct. 1. Avista is proposing an average 4.3% increase for its Idaho gas customers, an average of about $2.75/month for a typical residential customer. The electric adjustment is due to BPA reducing the size of the federal power credit.
Prior-day screen dive, slight retreats in southern heat have only minor impact.
Price changes continued to be mixed for a second straight day Tuesday, but slight downturns remained slightly dominant. A small retreat of high temperatures coming Wednesday in parts of the South, along with mild forecasts for the Northeast, Midwest/Midcontinent and Rockies, were abetted by the previous day’s decline of about a nickel by September futures in sending a small majority of cash points lower.
Marginal increases in temperature forecasts in several regions kept prices rising at nearly all points Tuesday. Otherwise, fundamentals such as slight prior-day futures weakness and the lack of any Atlantic tropical activity argued against any continued market firmness.