Storm

Despite a dearth of hurricane activity in 2006, speakers on a storm preparedness panel at the Offshore Technology Conference (OTC) in Houston Tuesday still had plenty to talk about. After all, the industry remains on the mend from the momentous 2005 hurricane season and digesting the lessons learned from the one-two punch of hurricanes Katrina and Rita.

London-based Tropical Storm Risk (TSR) reiterated last week that it expects 2007 Atlantic basin and U.S. landfalling tropical cyclone activity to be about 75% above the 1950-2006 norm, the highest March forecast for activity in any year since the forecaster began issuing real-time forecasts in 1984. Based on current and projected climate signals, TSR said there is a “high probability” for an active hurricane season.

London-based Tropical Storm Risk (TSR) is forecasting 2007 Atlantic basin and U.S. landfalling tropical cyclone activity will be about 75% above the 1950-2006 norm, the highest March forecast for activity in any year since the forecaster began issuing real-time forecasts in 1984. Based on current and projected climate signals, TSR said there is a “high probability” for an active hurricane season.

It’s still pretty cold in most market areas and temperatures are headed lower again Friday in the Midwest, but some moderation from the ice storm that descended on much of the U.S. earlier in the week, combined with Wednesday’s 40.4-cent dive by February futures and growing use of storage in lieu of new purchases of spot gas, allowed cash prices to continue their descent at all points Thursday.

With tight U.S. energy markets keeping prices at historically high levels, “several storm clouds are on the horizon” for the industry unless the supply burden is eased, according to former U.S. Secretary of Energy Spencer Abraham. He noted that another spike in energy prices could bring a backlash from the general public, which in turn could spark U.S. government intervention.

With tight U.S. energy markets keeping prices at historically high levels, “several storm clouds are on the horizon” for the industry unless the supply burden is eased, according to former U.S. Secretary of Energy Spencer Abraham. He noted that another spike in energy prices could bring a backlash from the general public, which in turn could spark U.S. government intervention.

Settling lower for the fifth consecutive regular session, March natural gas futures on Friday brushed off winter storm concerns for the weekend en route to carving out a new low for the move at $7.250. The prompt month finished the week at $7.316, down 16.3 cents from Thursday but an astounding $1.297 lower than the contract’s close in the prior week.

Hurricane disruptions in the third quarter reduced domestic natural gas production about 6% sequentially from the second quarter and about 6% compared to 3Q2004, but excluding the storm losses, the trendline in U.S. output for the next few years is flat, according to energy analysts with the Gerdes Group.

After being offline since Sept. 22 due to storm damage and flooding from Hurricane Rita, Sabine Pipe Line LLC said it has lifted the force majeure for various interconnects on its system (see Daily GPI, Sept. 27). As a result, the New York Mercantile Exchange (Nymex) said Tuesday it is lifting the force majeure condition for both September and October 2005 natural gas futures contract delivery obligations, effective for gas day Oct. 5 (see Daily GPI, Sept. 28).