The cash market didn’t have far to go in seeking support for a broad-based rally Monday. It found backing in several areas: new spikes throughout the energy futures complex (which likely will be reflected in physical gas even more strongly Tuesday); a past-due surge of cooling load ranging from Texas and the lower Midcontinent through the Southeast and into the Mid-Atlantic; a major production outage in the Gulf of Mexico; and the usual restoration of industrial load that tends to get dampened over a weekend.

The lifting of Saturday’s high-linepack OFOs by California’s two giant distributors also played a part in seeing that most of Monday’s increases of about 20 cents or more were recorded in the West. Appropriately after seeing Friday’s biggest loss of 46 cents, border-SoCalGas quotes led the way higher Monday with a gain of 45 cents that almost entirely negated its earlier slide.

Outside the West, prices rose from a little less than a dime to around 20 cents.

The June natural gas screen’s jump of 35.2 cents Monday was just part of the fireworks show at Nymex Monday. Although they came close but failed to post new record highs, oil-related futures also soared as traders continued to express skepticism about whether a Saudi Arabian pledge to increase crude output would have any meaningful impact on tight supplies. Other factors in the oil strength were Sunday’s fire that closed the 285,000 bbl/d Olympic Pipeline for refined products in the Pacific Northwest and the loss of about 150,000 bbl/d of crude production from the Gulf of Mexico. Crude futures for July spiked by $1.79 to $41.72/bbl.

An inadvertent shutdown of safety valves Saturday on the Mars pipeline at West Delta 143 in the Gulf of Mexico caused all production units on the Shell-operated Mars tension leg platform at Mississippi Canyon 807 about 130 miles southeast of New Orleans to also shut down subsequently (see related story). Mars had been producing about 170 MMcf/d, in addition to 150,000 bbl/d of oil. Shell expected to have a plan of action for making repairs ready by the end of the day Monday, a spokeswoman said.

Sources had been remarking for weeks about the usual pre-summer buildup of air conditioning load in the South being delayed this year. Well, only a week before the advent of the 2004 Atlantic hurricane season, hot times are here again. According to The Weather Channel, highs in the 80s and 90s will remain widespread in the region Tuesday.

Houston logged its first 90-degree high of 2004 Sunday and is expected to continue seeing peaks in the low 90s this week; last year it first hit 90 on May 5.

A Northeast utility buyer said it was fairly mild in his area again after it had experienced some heat last week. But he could definitely tell that Gulf Coast production-area prices were strong due to hotter weather building up in the South. His company tended to do most of Monday’s spot deals in Appalachia and at the citygates.

For another utility buyer in the Lower Midwest, not much heat was showing up yet in his city. Plenty of thunderstorms were keeping area thermometers subdued, he added.

June bidweek business was a slow starter Monday, said an East Coast utility buyer. He was starting to hear some interest in capacity release deals, but so far not much talk about actual supplies was surfacing, he said.

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