Monday’s price movement saw a reversal of geographic orientation from the previous Friday. On Monday it was the East that was mostly softer, while most western points rallied from Friday’s overall declines. Freezing temperatures were still in the forecast for Tuesday from the Northeast through the Midcontinent/Midwest and Great Plains into the Rockies, but relatively moderate weather is in play across the southern tier of states.

Other opposing influences on the cash market Monday were the previous Friday’s drop of 16.3 cents by February futures and the return of industrial load from its usual weekend dropoff.

Because of the greater number of trading points in the East, softness was dominant in the overall marketer. A majority of cash numbers were down from a couple of pennies to nearly $1.45. Northeast citygates tended to see the largest dips. Of points that ranged from flat to about half a dollar higher, most of the strength was concentrated in the Rockies.

One source suggested that with frigid weather continuing in Eastern Canada and across the northern U.S., it must have been further increases in the use of storage that allowed mostly softer eastern prices Monday in the face of plentiful heating load. Last Friday’s holiday/inauguration-delayed report, although in line with consensus expectations, provided further assurance that inventories are highly adequate for the rest of the winter, he said.

As if in affirmation, analysts for SunTrust Robinson Humphrey/the Gerdes Group noted Monday that in the heating season to date, net storage withdrawals “have totaled 852 Bcf compared to 1,009 Bcf last year and the long-term average totaling 939 Bcf. Looking ahead to this week’s storage data, assuming similar industrial/power-generation demand, a modest decline in LNG imports and 5% higher sequential gas-weighted heating degree days, we anticipate the [Energy Information Administration] could report a withdrawal of up to 185 Bcf [for the week ending Jan. 23].” Meanwhile, noting the latest plunge in the Baker Hughes gas rig count, the analysts said the tally has fallen by 162 rigs over the past four weeks and is now 26% below its September 2008 peak.

One thing that facilitated price recovery in western markets was an easing of problems with excess supply. Southwest Gas ended a Stage 3 OFO Monday, and Kern River said linepack had returned to normal after being high throughout its system Friday. SoCalGas still had a high-linepack OFO in effect Monday but planned to end it Tuesday, no doubt in response to cooler temperatures arriving in parts of Southern California.

The significant price weakness in the Northeast and Mid-Atlantic (Transco Zone 5 took Monday’s biggest hit as the pipeline ended an Imbalance OFO) occurred despite forecaster Justin Roberti saying both regions could expect to be invaded by heavy snow moving out of the Lower Midwest this week “in a two-part system that could give Philadelphia its first significant snowfall” of the season.

And Midwest citygates fell mostly by the teens, even though the region remained the epicenter of the harshest winter weather in the U.S. To be sure, conditions were a bit warmer than at the end of last week (e.g., Minneapolis was expected to bottom out around 10 degrees Tuesday after failing to get above zero Friday). But the temperatures were still cold enough to prompt Northern Natural Gas to keep a couple of System Overrun Limitations in effect for at lease one more day (see Transportation Notes).

As The Weather Channel (TWC) noted, the South “will experience a full spectrum of weather” Tuesday. It will range from freezing rain, sleet and snow plaguing eastern Oklahoma, much of Texas and northern Arkansas to the Florida peninsula basking in warm sunshine. In between will be a mix of conditions, but generally the South’s conditions will be seasonally normal except for the cold in the western end.

TWC predicted that high temperatures in the West Tuesday are expected to range from the teens in the Rockies and northeast Montana to the low 70s in Los Angeles.

The decline of drilling rigs searching for natural gas in the U.S. accelerated again last week after having slowed to a loss of four a week earlier, according to the Baker Hughes Rotary Rig Count ( Baker Hughes counted 1,185 active rigs in the gas hunt during the week ending Jan. 23, down 50 from the previous week. Three rigs were deactivated in the Gulf of Mexico while the onshore tally dropped by 47, Baker Hughes said. Its latest count was down 12% from a month earlier and 17% less than the year-ago level.

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