The January aftermarket started out strongly relative to end-of-December numbers, but without straying too far from apparent first-of-month index levels. Nearly all of the swing movement ranged from flat to about 20 cents higher, but gains tended to get much bigger at Northeast citygates, topped off by an advance of more than a dollar at the Transco Zone 6-NYC pool.

Cash traders shrugged off a steep screen dive of slightly more than 20 cents to concentrate on frigid weather expected to last at least until the end of the week in nearly all of the U.S. Not only was lake-effect snow continuing in parts of the Northeast and Midwest, but one forecasting service saw a good chance of the South encountering snows early in the new year.

Despite the moderate firmness shown at many points, prices were reported sinking from early highs throughout the course of the morning’s swing activity, largely in synch with the screen drop. Cash fell about a quarter from beginning to end, according to a marketer quoting Chicago citygates going from the $2.80s to the $2.50s and Midcontinent field numbers declining from the $2.50s to the $2.30s. In addition to the “tanking” of the February natural gas contract, Nymex also saw weakness in crude and heating oil futures, he noted.

It’s hard to call what the market will do today, the marketer went on, but Monday’s severe cash and screen downtrends hint at softness, he said.

However, in a note indicative of potential firmness at least in the Northeast and maybe the Gulf Coast, Texas Eastern said Monday that due to colder weather scheduled to arrive in its market area, it was prepared to force balance TABS-1 pools, if necessary, to maintain system balance and meet scheduled firm services. The pipeline added that it is considering restrictions of interruptible and secondary services starting Thursday for Market Zone 3 (M-3). Neither Texas Eastern nor affiliate Algonquin are accepting due-shipper payback nominations until further notice. Also, an OFO Type 3 begins today for eight market-area groups on the Sonat system (see Transportation Notes).

A marketer said he was “not sure why” both futures and cash were falling so markedly in late deals. “I think people didn’t want to be short over the weekend, but then they were comfortable selling their extra gas though the [New Year’s] holiday. It does leave them a little exposed, but on Friday traders couldn’t have known if they would find anyone to trade with on Monday. Maybe there were more people out there then we thought. That plus the weather has been shaky. I have heard several conflicting reports on the six- to 10-day weather outlook.”

A Canadian producer said Alliance has had a compressor down since last week, which is causing high-pressure problems in Alberta and backing up gas into the province. “A lot of our production currently is unable to flow to Chicago on Alliance,” she added, noting that the pipeline hopes to have the compressor back on-line today. Aeco prices were down a few cents to the high C$3.40s Monday, compared to the low to mid C$3.50s over the weekend, the producer said.

To a Midcontinent/Midwest source, Monday’s trading activity was fairly illiquid, which he attributed to many companies having only skeleton crews on hand who were eager to finish quickly and leave early that afternoon for New Year’s festivities. But a western utility buyer had a different impression. “I’d say there was about 80% [of the normal amount] of traders out there today,” he said. “It wasn’t too hard to find someone.”

Several firms left more business than usual to finish up on the last day of bidweek, but there was not a lot of new price discovery since many of the January deals done Monday continued to follow the indexing trend. Reportedly a few fixed prices were down from Friday levels due to Nymex softness, but not by much. But one source said January baseload at Transco Zone 6-NYC was being offered at $5.00 Monday on IntercontinentalExchange (ICE), which compared to his overall Z6-NYC WACOG of $4.50.

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