From November 2010 through the end of February 2011, average daily demand was about 2.6 Bcf higher than the previous year November to February period. Even with strong net storage withdrawals at times during January and February 2011, domestic production met a significant portion of that increase, according to Bentek Energy LLC. With the winter heating season winding down, daily market demand, which peaked at 100 Bcf per day or more on the coldest winter days, is settling into the high 70s.
Market attention will turn to expectations for storage injections and summer power generation loads. What clearly seems to have evolved out of the passing winter season is a market psychology that defaults to a view that supply is strong, even during times of seasonally induced demand stresses. That is an extraordinarily different market psychology than that of a decade ago.
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