WSI Calls for Continuation of Cool Temperatures in Most of Eastern US; Warm West, during August-October Period
WSI and ESAI Say Persistence of Cool Weather Will
Engender Lower Loads, Moderate Power Prices for Energy Traders
Andover, MA, July 22, 2009 — WSI expects the upcoming period (August-October) to average cooler than normal across the eastern half of the US, with above-normal temperatures common across the western US. Areas from the Southwest to the Pacific Northwest may be especially warm, compared to historical normals. The WSI seasonal outlooks reference a standard 30-year normal (1971-2000).
“There is no immediate sign that the very cool
pattern in much of the eastern US will abate. Persistence is a rather
useful forecasting tool during the heart of the summer, especially in
the absence of any significant pattern-altering tropical system. For that
reason, we have generally used persistence as our forecast for August.
Looking farther out in time, we expect a brief transition towards above-normal
temperatures in September across much of the Northeast. By October, the
emerging El Nino event and expected change in phase of the Pacific Decadal
Oscillation both argue strongly for a cold month across much of the eastern
US. There are no strong signals for any sustained cool weather in the
western US during the upcoming period.”
In August, WSI predicts regional temperature anomalies as follows:
Northeast – Cooler than normal
Southeast – Cooler than normal
N Central – Warmer than normal
S Central – Warmer than normal
Northwest – Warmer than normal
Southwest – Warmer than normal
According to Paul Flemming, ESAI’s Director of Power and Gas, “Natural
gas demand from the power sector will be higher due to warmer temperatures
in the Southwest and dry conditions in the Northwest, however, cooler
weather in the East will largely offset this demand. Barring any significant
hurricane activity, power sector demand for natural gas in August will
not reverse the trend of well above average inventory build rates and
will result in continued pressure on prices. For the power markets in
the East, the big news is that there will be a reduced likelihood of heat
events in August, even after a very mild July.”
In September, WSI sees the monthly breakdown as:
Northeast – Warmer than normal
Southeast – Cooler than normal
N Central – Warmer than normal
S Central – Warmer than normal
Northwest – Warmer than normal
Southwest – Warmer than normal
“The WSI September forecast indicates warmer-than-normal temperatures
in most of the country and much-warmer-than-normal temperatures in Texas
and the Southwest. Due to prevailing warmer temperatures in the West,
natural gas demand from the power sector should be above average in September,
but this higher demand will not likely offset the trend towards very high
inventories in early November,” said Paul Flemming of ESAI. “Higher
probabilities of late summer heat events continue for Texas and the Southwest
in September along with a likelihood of higher price volatility.”
In October, WSI forecasts::
Northeast – Cooler than normal
Southeast – Cooler than normal, except FL
N Central – Cooler than normal
S Central – Warmer than normal
Northwest – Warmer than normal
Southwest – Warmer than normal
“The WSI October forecast indicates a continued trend of cooler-than-normal temperatures in the eastern half of the country and much-warmer-than-normal temperatures in Texas and the Southwest. Shoulder-season dynamics should overshadow weather variations as lower demand for gas and power means less dependence on weather,” noted Paul Flemming. “Power prices will be supported by generator maintenance, and gas demand from the power sector should be supported by coal plant maintenance and nuclear refueling.”
WSI, which provides customized weather information to
energy traders, issues its seasonal outlook twice-monthly. The next new
forecast package (for the September-November and October-December periods)
will be issued on August 26.
About WSI Corporation
WSI is the most trusted source of weather information across the globe. Top
insurance, risk management companies and financial institutions, worldwide,
trust WSI to supply them with easy-to-use, timely and expert weather guidance
to help anticipate market volatility, mitigate risk and make critical decisions
with confidence. WSI is a member of The Weather Channel Companies and is headquartered
in Andover, Massachusetts, with offices in Birmingham, England. The Weather
Channel Companies are owned by a consortium made up of NBC Universal and the
private equity firms, The Blackstone Group and Bain Capital. For more information,
please visit us on the web at www.wsi.com
or call us at 877.WSI.CORP or +44.121.233.7600.
Print Page