There were very few places outside the extreme southwesterncorner of the U.S. still seeing high temperatures any greater than70 degrees Tuesday, and the growing chill was manifested in furthergas price increases. Though milder than Monday’s gains and almostnon-existent in California and parts of the Rockies, the new pricehikes were generally on either side of a dime in the Gulf Coast,Midcontinent/Midwest and Northeast. Much like the day before,Northeast citygates tended to rise the most between 10 and 14cents.

A big aggregator considered the fresh price strength due mostlyto widespread colder weather, abetted by some support from a higherscreen. But futures was deriving much of its support in the firstplace from the cold forecasts, he said.

Basis between the screen and cash got tighter, noted a producer,with cash quotes in eastern production areas running barely over adime back of the November futures contract. Also, basisdifferentials between Midcontinent and Gulf Coast pipes virtuallydisappeared, with both areas running neck and neck in the mid tohigh $2.80s.

A Northeast buyer characterized the market as “pretty much of abuying frenzy.” In several cases the gas just wasn’t there when heneeded it, he said, reporting his first Texas Eastern M-3 purchaseat $3.16; several packages later the price was almost a dime higherat $3.25. “I was buying all the way up to the 11:30 deadline, andthat doesn’t usually happen,” he said.

A Gulf Coast producer was moved to paraphrase the opening lineof a popular Christmas song, saying, “It’s beginning to look a lotlike winter.” An East Coast utility buyer couldn’t disagree sinceforecasts called for even colder weather by the weekend, but said,”We can only hope the gas prices don’t get too much higher thanthis.”

Jose had reached hurricane status as it approached the LesserAntilles at the eastern edge of the Caribbean Sea Tuesday. But atleast one forecaster thought there was almost “no way, Jose” forthe storm to reach the East Coast of the U.S., much less the Gulfof Mexico production area.

©Copyright 1999 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.