WSI Energycast Outlook Calls for Cool Spring in Northern U.S.; Generally Warm South

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WSI expects the upcoming three-month period (April-June) to average cooler than normal across much of the northern tier of the U.S. along with parts of the Southeast, with above-normal temperatures across the south-central and southwestern U.S. The WSI seasonal outlooks reference a standard 30-year normal (1971-2000).

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WSI expects the upcoming three-month period (April-June) to average cooler than normal across much of the northern tier of the U.S. along with parts of the Southeast, with above-normal temperatures across the south-central and southwestern U.S. The WSI seasonal outlooks reference a standard 30-year normal (1971-2000).

The monthly breakdown for the upcoming fall season follows:

In April:
Northeast - Cooler than normal
Southeast - Cooler than normal
N Central - Cooler than normal
S Central - Warmer than normal
Northwest - Cooler than normal
Southwest - Warmer than normal

Expected Market Impact (provided by ESAI):
The WSI April forecast indicates warmer-than-normal temperatures in the South Central and Southwest regions, with cooler-than-normal temperatures in other regions. In April, weather variations will have less impact on electricity demand swings due to lower shoulder-season loads. Natural-gas demand will be impacted by cooler weather in the eastern and northern heating regions as incremental late season withdrawals could reduce inventories. However, inventories are likely to finish at a high enough level that late season withdrawals will have only minimal impacts on price. Natural-gas demand should also move higher due to nuclear refueling shutdowns during April and May as well as generator maintenance at coal plants. The increased reliance on natural gas to fill the gap should add some marginal demand to the regional gas market, and provide some weather-related support to natural-gas prices. Weather-related demand for gas and electricity should be slightly above normal in most regions except for Texas where temperatures are expected to be well above normal in April.

In May:
Northeast - Cooler than normal
Southeast - Warmer than normal, except FL
N Central - Cooler than normal
S Central - Warmer than normal
Northwest - Cooler than normal
Southwest - Warmer than normal

Expected Market Impact (provided by ESAI):
The WSI May forecast continues to indicate cooler-than-normal temperatures in the northern tier of the country, and warmer-than-normal temperatures in the South Central and Southwest regions. Warmer temperatures in these regions should bring early cooling demand boosting electricity and natural-gas loads. In other regions, cooler weather expectations should preempt any early season heat expectations and electricity demand should be slightly below normal. Natural-gas demand in May will again be impacted more by nuclear and coal generator maintenance programs than by deviations in the weather due to the lower shoulder season electricity loads. Natural-gas injections to storage should be close to normal based on weather expectations, but injections could be higher than normal due to lower demand expectations because of poor economic conditions.

In June:
Northeast - Warmer than normal
Southeast - Cooler than normal
N Central - Cooler than normal
S Central - Warmer than normal
Northwest - Cooler than normal
Southwest - Warmer than normal

Expected Market Impact (provided by ESAI):
The WSI June forecast indicates warmer-than-normal temperatures in the Northeast, South Central and Southwest regions. Warmer-than-normal temperatures in the Northeast should be bullish for electricity demand and prices, particularly in New York and PJM where even higher temperature expectations result in a higher probability of early-season heat events. Cooler weather in the Southeast region should result in slightly lower gas demand from the power sector, offsetting higher demand expectations across the other southern regions.

According to WSI seasonal forecaster Dr. Todd Crawford, "The general pattern of cold-north and warm-south observed during recent months will generally continue into late spring. The warmest temperatures, relative to normal, will continue to be in the south-central and southwestern states. The North Atlantic and North Pacific Oceans are now both cooler than normal for the first time in 15 years. This may mean a cooler summer than we've had in quite some time, particularly in the southern U.S. if the drought breaks this spring. The current thinking is that much of the northern U.S. will see near to slightly above-normal temperatures this summer."

WSI, which provides customized weather information to energy traders, issues its seasonal outlook twice-monthly. The next new forecast package (for May-July, plus the first official summer (June-August) forecast) will be issued on April 14.

About WSI:
WSI Corporation is the world's leading provider of weather-driven business solutions for professionals in the energy, aviation, and media markets, and multiple federal and state government agencies. WSI is headquartered in Andover, Massachusetts with offices in Birmingham, England and was recently purchased by a consortium made up of NBC Universal and the private equity firms The Blackstone Group and Bain Capital. More information about WSI can be found at http://www.wsi.com.

About ESAI:
Since its inception in 1984, Energy Security Analysis Inc. (ESAI) has been dedicated to monitoring, analyzing, and synthesizing information about world-wide energy markets. Tapping the talents of its senior-level staff, ESAI provides clients with unparalleled insight into where the markets have been and where they are headed. ESAI provides ongoing systematic analysis of energy prices in the oil, natural gas, and energy markets. For more information on ESAI services, see http://www.esai.com.

Contacts:
Kristen Sullivan    
Weather Services International
(978) 983-6607    

Jill Kinsley
Communications Manager
ESAI
(781) 245-2036

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