Cash prices emerged from the weekend with widespread gainsMonday. Most were of the small-to-medium variety at 2-6 cents, buta scorching West tended to see a lot of double-digit increases. SanJuan Basin and the Southern California moved in near-lockstep,rising about a quarter each. However, a basis relationship gap ofnearly 50 cents between the two points remaineduncharacteristically wide compared to traditional levels,reflecting the inroads made by Canadian and Rockies supplies intothe California market in recent years.

There’s really nothing beyond heat in California and the PacificNorthwest to explain jumps of a dime or so on several Rockiespipes, a marketer said. Another reported a large volume of electricgeneration demand for gas in California, saying power deals donefor today were soaring as high as $150/MWh Monday. The state’sindpendent system operator was calling for out-of-state emergencypower Monday because some supplies had tripped off, he said.

A Northeast region trader said it wasn’t so much hot weatherdriving Eastern markets but more upcoming cash-out pricing.Following last week’s softening, she said, current cash prices arebelow what people expect as cash-out levels on many Gulf Coastpipes. Thus those running short supply positions are paying up toavoid getting stuck with big penalties for negative imbalances, sheadded.

For one producer, August business remained a case of “a lot oftalking and very little happening” Monday. However, several sourcessaid they were clearing the incremental-July decks for Augustaction and that a number of companies would be in strategy meetingstoday. Despite the heat most people remain bearish, a producersaid, “but anything could happen going into this bidweek.”

One hint that August pricing may have strengthened a bit sincelast week comes from a marketer reporting Sumas deals done Mondayat $1.53-54. As of last week sources were projecting Sumas numberson either side of $1.50 and later a little below $1.50.

A marketer said he was hearing Southern California border talkin the neighborhood of $2.25. New basis scuttlebutt includedColumbia-Appalachia at plus 12; South Texas intrastates at minus 3;Carthage at minus 3.5; Katy even with the screen; Transco Station30 at minus 2 and Texas Eastern-West LA at minus 6.25.

Cooling load is expected to remain strong as August begins. TheNational Weather Service’s forecast for Thursday through nextMonday calls for above-normal temperatures in nearly all parts ofthe U.S. westward from the central Appalachians/OhioValley/Southeast region.

©Copyright 1998 Intelligence Press Inc. All rights reserved. Thepreceding news report may not be republished or redistributed, inwhole or in part, in any form, without prior written consent ofIntelligence Press,Inc.