Market Claws Higher on Weather, Futures
Cash prices finished the week on a positive note as continued
incremental heating demand and a strong futures market bolstered
prices Friday. Trading was very active from the outset, a Gulf
trader told Daily GPI. "There were some undeniable factors pointing
to higher cash prices. Overnight gains in Access trading set the
tone, then the over the counter market verified the strength," he
explained. So it came as no surprise when the first cash offers
were a nickel or more above Thursday's averages. But the market
could not sustain the price rally and after buyers had filled their
requirements at around 9:45 CST, seller realized their lowest
prices of the day in late morning dealings.
Higher prices were not localized in the East. Rockies prices
also defied traders' expectations by retaining their strength.
Sumas, however, was the notable exception slipping almost a nickel
from Thursday's levels. And a Northwest trader fears the price rout
will only get worse today. He points to storage maintenance in
British Columbia that will flood the market with as much as 300
But as British Columbia loses a storage facility, the Rockies
gains one back. A Rockies trader said the Clay Basin Storage
facility, which is located near Vernal, UT, being back up after
being down for four days due to project work (See Daily GPI, April
9) helped keep the market strong Friday. "When the Clay Basin
opened up, any excess gas went there, instead of being sold at a
cheaper level. There is 56 MMcf going in [Saturday] from the
Northwest pipeline, and I think that helped keep things up."
Looking forward to this week, one Midcontinent trader said
weather will be making its presence felt in the opposite direction
of last week's price increasing performance. "Although there is
snow on the ground in Des Moines, IA, temperatures should normalize
in the next couple of days and cause spot prices to slip slightly."
One forward-looking Midwest source is already scouting out the
upcoming bidweek. He expects a heavy amount of index deals, with a
bullish futures market helping to welcome in the new prompt month.
©Copyright 1999 Intelligence Press Inc. All rights reserved. The
preceding news report may not be republished or redistributed, in
whole or in part, in any form, without prior written consent of
Intelligence Press, Inc.