The next three months will bring warmer-than-normal temperatures to much of the country and portions of the West may be especially warm, with only the Southeast expected to stay cooler than normal through November, according to a seasonal forecast from WSI Corp. of Andover, MA.

“The pattern that resulted in a record cold July in many eastern U.S. locations has finally abated,” said WSI seasonal forecaster Todd Crawford. “We expect the warmer pattern to continue in September, with the exception of the Southeast, where conditions will likely be cooler and wetter than normal. By October and November, the impacts from the current El Nino event will begin to take hold with increased chances of cold temperatures across much of the eastern U.S.”

In its Energycast Outlook for September WSI forecast warmer-than-normal temperatures to dominate all of the country except the Southeast, where cooler-than-normal temperatures were expected. Those warmer temperatures should drive natural gas demand higher during the month, according to Energy Security Analysis Inc. (ESAI) analyst Chris Kostas.

“Continued slack industrial demand, however, and the seasonally cooler temperatures of September should offset the marginal effects of these warm temperatures,” Kostas said in a statement issued in conjunction with WSI’s outlook. “Barring any significant hurricane disruptions, natural gas prices will remain depressed in September and inventories should approach the previous record of 3,545 Bcf set Nov. 2, 2007, by the end of the month.”

The chance of such hurricane disruptions appear to be lower now than in the past few years. WSI, which had initially predicted 13 named storms, three of them intense (Category Three or greater) this year, has reduced its forecast to a total of 10 named storms, including five hurricanes, with two of them intense (see Daily GPI, Aug. 25). The lower forecast was driven by a wind shear environment unfavorable to hurricane development across the tropical Atlantic and the effects of the current El Nino event.

El Nino — the warming of surface temperatures in the central and eastern equatorial Pacific ocean, which can influence the formation of Atlantic hurricanes — arrived at the end of June, according to National Oceanic and Atmospheric Administration scientists (see Daily GPI, July 10). El Nino events, which occur every two to five years and typically last about 12 months, can help suppress Atlantic hurricane activity and are believed to affect a variety of North American weather patterns.

WSI forecast cooler-than-normal temperatures moving into the Great Lakes region in October, with warmer-than-normal temperatures remaining in the Northeast, West and South-Central regions. West Texas and areas west of the Rockies can expect much warmer-than-normal temperatures. October will probably be “neutral” on demand, Kostas said.

“We expect cash prices at Henry Hub will likely trade with a two-handle for a large portion of the month with price-induced shut-ins of production and gas-on-coal competition balancing the supply/demand equation. Shoulder-season dynamics and generator maintenance should overshadow weather variations in October, as lower demand for gas and power means less dependence on weather,” Kostas said.

The cooling trend will continue to spread in November, with cooler-than-normal temperatures moving into the Northeast and South-Central regions during the month, WSI said. The relatively cool forecast will boost demand significantly from October’s depressed shoulder-month levels, while continuing warmer-than-normal weather in the West will reduce regional seasonal heating demand slightly, according to ESAI.

“On balance, November should be bullish from a weather-related perspective. Power prices in November should be supported by firmer spot gas prices and firmer peak loads,” Kostas said.

Looking further ahead, Crawford said the current El Nino event will also play a part in weather patterns this winter.

“The pattern for the upcoming winter will depend strongly on the evolution of this El Nino event during the next few months. A weaker event centered farther east in the tropical Pacific will more likely enable a cold winter in much of the eastern U.S., while a stronger and more west-centered event would increase the odds of a very mild winter in the Northeast. We currently favor slightly the former, colder idea, but with very high uncertainty at this point.”

The WSI seasonal outlooks reference a standard 30-year norm (1971-2000). The next forecast, for October-January, is scheduled to be issued Sept. 23.

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