The cash market pulled out of its early-2000 slide at leastbriefly with a generally flat to slightly higher price performanceWednesday. However, sources found little but bearish indicators forthe near future.

The Gulf Coast and Midcontinent/Midwest markets were flat tojust a tad higher, while the Southwest basins and Californiacontinued their capacity constraint-related strength from Tuesdaywith Wednesday gains of around a nickel. Athough a cold frontapproaching the East Coast helped spur increases of about a nickelby the Appalachian pipes and New England citygates, the rest of theNortheast was slightly softer with Transco Zone 6-NYC recording theday’s biggest drop of slightly more than a dime.

“Nothing happened with Y2K; the world’s just the same as we knewit before,” noted a Northeast aggregator. But the gas market, headded, is looking more and more sluggish. Prior to AGA’s storagereport Wednesday afternoon, he predicted a withdrawal of 150-175Bcf. “But you know the [withdrawal] volume is going to falldrastically next week” because that report will incorporate thetail end of the Christmas holiday weekend and the beginning of therelatively warm New Year’s weekend, he noted.

It was a fairly bearish signal when AGA reported only 133 Bcftaken out of storage last week. And the hints of upcoming marketweakness didn’t end there. In its latest six- to 10-day forecast,the National Weather Service predicts that only the West Coaststates and sparsely populated tier from Idaho through northwesternMinnesota are likely to see below-normal or much-below-normaltemperatures.

A gas buyer for one Southern utility said, “We’re about ready tojoin the crowd that thinks the winter of 1999-2000 is already overfor all practical purposes. You can tell from our low volume [10MMcf/d in new purchases Wednesday] that there’s not much loadaround here.”

El Paso’s OFO was still lending support to western prices, amarketer said, as both the Permian and San Juan Basins tradedslightly above Henry Hub. San Juan well freeze-offs were stilloccurring but easing up, he said; that was evidenced by a lot moreSan Juan supplies becoming available late in the trading session.El Paso, after posting a bulletin board notice earlier Wednesdaythat it was extending the OFO, lifed the order effectiveimmediately late that afternoon.

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