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Screen-Influenced Cash Increases Lowest in West

Screen-Influenced Cash Increases Lowest in West

Though the May Henry Hub futures contract eventually settled for a small gain of less than a penny, it was the screen's morning flirtation with the $2.15-17 area that got most of the credit for a strong performance Tuesday by the cash market. Cash rises tended to fade out going westward to virtually nothing in California trading, but virtually all eastern points were up at least a nickel and in many cases saw increases approaching a dime.

With last week's western chill now fading into memory, buyers in the region know there is plenty of supply available again, a marketer said. That means a stronger early screen was essentially the only thing keeping prices there from falling Tuesday, he added.

Two Gulf Coast producers disagreed on which way cash trading was going as the session proceeded. One perceived some late strength based on a short supply squeeze. She reported getting the sense that buyers weren't finding suppliers quite as eager to sell as the buyers would have liked. But the other producer said prices started high and then fell off at the end. He expects prices to start falling again soon, saying now-disappearing cold weather in the West has been the main reason for April's price strength so far.

If gas prices get much higher than they are now, a northeastern electric utility buyer seriously doubts whether she would make any new purchases for May. Gas is getting very close to fuel oil price levels at the burnertip, she said, and higher prices for gas likely would mean fuel-switching at the company's power plants.

The casualty toll in last week's explosion of TECO Energy's coal-fired Gannon power plant near Tampa, FL (see Daily GPI, April 9), now stands at three dead and 49 injured after a second worker died of his wounds in a hospital. A news report Tuesday said four of the plant's six generating units, representing a little over half of its 1,200-megawatt capacity (earlier reports had given the size as 1,270 megawatts), were back in service. TECO officials blamed worker error for the explosion, saying pressurized hydrogen used to cool turbines should have been drained before the 6 unit was taken off-line for maintenance.

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