For the most part, a bearish trend in the fading December swingmarket once again held sway Thursday. With the continuing exceptionof rises at some Northeast citygates, most points registered pricedrops between about a dime and 50 cents. California, Sumas andTransco Zone 6 (non-NYC) led the way with triple-digit declines.

Although northern market areas are expected to remain belowfreezing through the New Year’s Day weekend, a relative warmingtrend in other regions, particularly in the Southwest, helped dragprices further down, sources said. The February futures contracthad little influence on cash as it spent part of the morning mildlysofter, then managed to achieve a slightly positive position beforeending the day down a little more than 2 cents.

A Transco Zone 6 (NYC) buyer replied with a sarcastic “whoopee!”when told his market had replaced California as the one with themost expensive gas in the last couple of days. “It beats me” whyZone 6-NYC is costing so much more than other regional citygates,he said, because there are no constraints of much significance onTransco. Although Thursday’s $26 peak came nowhere near matchingthe late spike to $37 on Wednesday, the average rose by about adollar and a half to a point-specific record of more than $21.

Although Nicor had not declared a Critical Day as of Thursdayafternoon, a couple of sources confirmed that the Chicago-area LDCwas advising customers to have their pagers handy this weekend. Ithad some people in a mild panic over what “might happen [with theweather] over the weekend,” one said.

The big crash in Sumas prices recently (and to a lesser extent atStanfield) was partly due to moderating weather, but also wasinfluenced heavily by pipeline actions. Northwest has lowered therequired percentage of north-end receipts under a “must-flow OFO” from25% to 10% (see TransportationNotes). And since Christmas Day, when a pack tolerance of 20% wasstill in effect and draft tolerance was zero, Westcoast has reversedthose numbers to zero and 20% respectively.

A number of traders bid adieu to the December 2000 swing marketThursday, reporting deals that were scheduled for flow throughSunday. One who did Friday-only deals expects it to be “kind ofmessy” today trading separately for the Saturday-Sunday andMonday-Tuesday periods.

A tendency toward indexed deals with hefty premiums began duringthe December bidweek in California, where so many national trendsoriginate. It’s now happening on the other coast, where one sourcereported several purchases at a Transco Zone 6-NYC index plus$1.50-2.00.

A buyer at the Chicago citygate said, “In a way I got my belatedChristmas wish by waiting for January prices to soften.” He madepurchases Thursday at the GPI index plus a nickel, which comparedwith reports of deals at GPI index plus 40-50 cents earlier thisweek. (One trader said he heard a NIPSCO deal was done at indexplus $1.10.) However, another Midwestern trader said he was seeinglittle change Thursday in January fixed prices.

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