As the countdown to today’s May futures expiry continuedTuesday, swing cash prices certainly did their part to encouragethe bulls in Nymex’s trading pit. But in a form of reciprocatingsupport, sources said late-April price rises of about a dime inmost markets were based almost solely on screen upticks Monday andTuesday. Except for moderate air conditioning load in Texas and theSoutheast and a bit of lingering chill in the West, weatherfundamentals were almost non-existent, they said.

Although increases of a dime or more made Midwest citygatesamong the day’s strongest trading points, Midcontinent field pricestended to lag the overall market with several pipes little morethan a nickel higher. The Midcontinent tried to start nearly a dimeup but quickly faded back a few cents, one marketer said. Notingthe citygate strength, she suggested that maybe the economics oftransporting field gas made it a better strategy to fulfill Midwestdemand from storage. In addition, since the West is no longer ascold as it was earlier this month, it’s likely that more Rockiesgas is flowing east into the Midcontinent/Midwest market, she said.

May basis appeared to be a tale of two regions Tuesday. GulfCoast basis is remaining very tight, said a trader who perceivedbasis for Agua Dulce, Katy and Houston Ship Channel as a pennytighter than usual. And a Florida Gas Transmission trader said thatpipe’s basis is strong because of “extra-tight capacity” on thesystem, which he called very unusual for this time of year.

But a producer said Southwest basis is widening due to thescreen’s rise and also to the expectations of hydropower figuringmore and more prominently into the West’s electric generation mixas May proceeds. He pegged new basis Tuesday at minus 16-17 forPermian Basin, minus 27-28 for San Juan-Blanco and minus 9-10 forSouthern California border. Because of “a heck of a lot ofmaintenance” scheduled for May in San Juan Basin, the producerthinks California buyers are sourcing more May gas from the PermianBasin than they have in the past few years.

Convergence was working well for a marketer reporting Californiaborder prices for May in the mid $2.20s, only a penny or two lessthan his late-April swing numbers. But a Sumas trader said Mayprices there had slipped to $1.90-95, more than a nickel below hisApril quotes in the low $2.00s.

The contrast between this bidweek and the last one is readilyapparent, a Midcontinent trader said. “If you look at April’sbidweek, people couldn’t give it [gas] away. To be short was to beenvied,” he said. “But with the price run-up during April, they’ve[short-position traders] been hammered. Now, in this bidweek,nobody wants to be caught like that again, so everybody is goinglong.”

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