Warmer-than-normal temperatures will continue across most of the United States through January, WSI Corp. forecasters said Monday, adding their voice to the growing chorus predicting a relatively warm winter.
Referencing a standard 30-year normal period (1971-2000), Andover, MA-based WSI said temperatures will average warmer than normal November to January in all locations except for parts of the northern Rockies, northern Plains and extreme northern New England. An ongoing La Nina event — cooling ocean surface temperatures off the western coast of South America that have been found to disrupt normal weather patterns in the United States — will continue to influence weather heading into the winter months, said WSI seasonal forecaster Todd Crawford.
“This La Nina event has strengthened quite substantially over the last month, and is now in the upper end of the moderate category, with the potential to end up being a full-fledged strong event,” Crawford said. “As the atmosphere transitions to the more energetic winter pattern, we may get a few weeks of cold weather in the East during the next couple of months. Indications are that late winter may be quite warm, however, especially in the Southeast. The Northeast will likely be warm on average as well, however, there will likely be occasional spells of very cold weather due to the proximity of colder-than-normal temperatures in southeastern Canada. This will limit the magnitude of the above-normal temperature anomalies for the entire winter period.”
Weather forecasters at Colorado State University (CSU) recently said the same La Nina event will cause above-average activity during the final two months of the 2007 hurricane season and could extend the hurricane season, which runs until Nov. 30 (see Daily GPI, Oct. 3).
The WSI forecast for November indicates warmer than normal temperatures across the entire northern tier of the country, except Washington and Oregon, and in the Southwest except for California. WSI also forecast colder than normal temperatures in November in the Southeast and South Central regions, except for Kansas and Oklahoma.
Energy Security Analysis Inc. (ESAI) said the warm weather across much of the country in November will delay early season heating demand for gas and should extend the injection period for natural gas into storage, increasing the likelihood that inventories will reach maximum levels during the month and easing any concerns about the winter availability of gas. Power demand will be moderate due to shoulder-season temperatures and prices will be influenced early in the month by continuing generator maintenance, according to ESAI.
By December, colder than normal temperatures will have spread to the North Central, Northeast and Southeast regions, with the exception of Florida, Mississippi and Alabama, WSI forecast, while warmer than normal air will remain over the Southwest and Northwest — except for Idaho, Montana and Wyoming — and will move into the South Central region. Cold weather across all the major heating demand areas in December should be bullish for gas prices, ESAI said, however, supply concerns are likely to be moderated by high natural gas inventories at the start of the heating season in mid-November. Power prices are likely to be influenced more by gas price increases than through increased load induced by cold weather, according to ESAI.
By January, warmer than normal temperatures will return to most of the country — the Southeast can expect much warmer than normal weather, WSI said — with only Maine, North Dakota, Minnesota, California and the Northwest missing out on the trend. ESAI said that while the warming trend in January could decrease the chances for extended cold snaps, which would provide price volatility in natural gas, the La Nina event could bring occasional shorter periods of very cold weather. Natural gas demand should be below-normal given the generally warmer profile across most regions. Colder than normal weather on the West Coast and the increased gas demand likely to come with it is not likely to offset the lower demand from other regions, ESAI said.
The WSI forecast comes less than a month after the Natural Gas Supply Association (NGSA) said warmer-than-normal temperatures, a flat economy and moderate growth in both natural gas demand and supply should produce a relatively stable market this winter (see Daily GPI, Sept. 28). While the Washington, DC-based association does not predict wholesale or retail natural gas prices, it noted that some independent analysts have said Henry Hub spot prices could average in the $7.00-9.00/MMBtu range this heating season.
According to NGSA, weather will likely put upward pressure on the natural gas market this year. The association based its prediction on recent National Oceanographic and Atmospheric Administration’s (NOAA) predictions of a slightly warmer than normal winter and forecasts of moderate level of activity in the remaining weeks of the hurricane season. Last week NOAA confirmed its earlier prediction for above-average temperatures over most of the country between December and February, and forecast drier-than-average conditions across much of the Southwest and Southeast (see Daily GPI, Oct. 19).
Natural gas demand for this winter is likely to increase 278 Bcf or 1.8%, according to Energy Ventures Analysis Inc. (EVA). Compared to last winter’s slightly warmer-than-normal weather, the increase will result in natural gas demand for both residential and commercial consumers of nearly 168 Bcf or 3.2% above that for last winter. EVA has projected 3,530 heating degree days (HDD) this winter, compared to 3,354 HDD last winter. Offsetting some of the weather-related increase in demand will be consumer conservation and the lack of recovery in the industrial sector, according to NGSA, which anticipates that the modest increase in demand will result in flat winter-to-winter price pressure.
WSI said an update to the current forecast will be issued on Thursday, with the next new forecast package (for December-February) issued Nov. 13.
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