Finding almost no heating load of any consequence remaining and with nothing resembling summer heat to kick-start power generation demand surfacing yet outside parts of the desert Southwest, prices continued to drop Friday. Thursday’s slightly bearish storage report and the typical weekend slump in industrial load contributed to the cash market’s decline.

Northeast citygates, where a bit of midweek chill was starting to yield to milder conditions, recorded most of the larger drops, which ranged from a couple of pennies to about 20 cents.

For traders who had wondered if the screen’s 9.1-cent gain Thursday would be enough to generate a small cash rally Friday, the answer was no. After all, natural gas futures were primarily “following the oil” that day and not reacting to the Energy Information Administration’s estimate of a 44 Bcf addition to storage levels during the previous week, one source said. Besides, he added, a sizeable injection had already been factored into market psychology beforehand.

The screen’s retreat Friday to just under $7 and the forecasts of moderate temperatures virtually everywhere this week should keep cash quotes on a downhill slope Monday, he said.

A producer who trades the Northeast said the region was due for a long stretch of nice springtime weather, although it was still a little breezy and cool Friday. “The weekend should be gorgeous,” he said. Delivered prices in the lower Northeast were mostly in the low $7.40s, with New England citygates running a nickel or so higher, he noted. Henry Hub, which had maintained a premium to May futures as recently as Wednesday, again traded a few cents back of the screen Friday, he said.

The producer reported having to strand some of his pipeline capacity into the Northeast “because the spreads from both the Gulf Coast and Canada weren’t there.” They had tightened from Thursday’s basis and didn’t cover his company’s variable transport costs in some cases, he said. He said he was able to divert “a little bit” of supply into storage for the weekend.

Citigroup analyst Kyle Cooper made an initial estimate of a storage build in the upper 30s Bcf (about 5-7 Bcf less than Thursday injection report) to be declared by EIA for the week ending April 15.

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