With June rapidly coming to a close minus excessive heat in most regions of the country, WSI Corp. warned Monday that the July through September time frame might require a little more air conditioning for most parts of the country, Referencing a 30-year normal standard from 1971 to 2000, the Andover, MA-based forecaster said it expects the period to average warmer than normal in all locations except for the Pacific coastal cities, parts of Texas, and the extreme northern tier of states.
However, WSI said the high-energy-demand Northeast could be spared the significant heat. “Our objective forecast models now indicate cooler late-summer temperatures in the northeastern quarter of the nation,” said WSI seasonal forecaster Todd Crawford. “Further, the Atlantic Ocean cooled significantly, relative to normal, in May. So, the weight of evidence now suggests that most of the eastern heat will be focused in the Southeast for the remainder of the summer, where drought conditions continue to persist.
“Any heat in the Plains will continue to be tempered, both in magnitude and duration, by the very wet conditions there as well,” Crawford added. “Finally, recent developments in the tropical Pacific indicate that the emergence of a La Nina event this year is now unlikely.”
For July, WSI sees warmer than normal temperatures for the entire country with the exception of coastal California, Texas and the Northeast. The Northeast is expected to exhibit cooler than normal temps for the month with the exceptions of New York, New Jersey and Pennsylvania.
Breaking down WSI’s July forecast, Energy Security Analysis Inc. (ESAI) said the cooler outlook for key demand areas is slightly bearish for gas demand in these areas and could moderate any summer demand-related price increases. “The slightly warmer than normal outlook for temperatures in the rest of the country provides a higher probability of heat events and an increased likelihood of weather-related price spikes in the power markets,” the Wakefield, MA-based analytical firm said.
WSI said that during August the Northeast and North Central portions of the country will see cooler than normal conditions with the rest of the country — except Montana — experiencing warmer than normal temperatures.
“Warmer-than-normal temperatures in the Southeast and Southwest regions will increase natural gas demand for cooling in these areas,” ESAI said. “This demand increase will be offset by lower demand from the Northeast and North Central regions. Power prices in the Northeast [regional transmission organizations] should be moderate with lower load expectations due to the cooler than normal forecast.”
With the arrival of September, WSI said the Northeast is expected to finally exhibit warmer than normal temperatures along with the Southeast, South Central (except West Texas) and North Central regions of the country. The West is expected to see cooler than normal conditions except in Idaho, Montana, Wyoming, Nevada and Utah.
“Cooler weather in the Southwest and California will have a bearish impact on natural gas demand from the power sector while warmer weather in the Northeast will result in slightly higher-than-normal gas demand,” ESAI said. “Overall, natural gas demand in September should be neutral to bearish for gas prices. The cooler outlook in California and the Southwest diminishes the likelihood of late-season extended heat events and the occurrence of associated power price spikes.”
WSI said an update to the current forecast will be issued on June 28 with the next new forecast package (for August-October) issued on July 17.
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