Screen Leads Cash Market to Moderate Downturn
As many had expected, the cash market retreated slightly
Thursday from the early May aftermarket peaks posted Wednesday. The
decline was moderate with most points off anywhere from a penny or
two to just over a nickel.
Fundamental influences continued to be lacking, so nearly all
sources considered the futures screen's drop of more than 6 cents
as the main cause of cash softness. However, a Gulf
Coast/Midcontinent trader said power generation load, which had
helped drive the market higher earlier in the week, appeared to be
easing off as more non-gas-fired units come back on-line from
maintenance or refueling outage. Another source noted that many
people thought the Wednesday afternoon storage report was slightly
on the bearish side.
Chicago and Michigan citygates were trading at approximate
parity around $2.40 Thursday after entering the month with Michigan
indexes commanding a premium of 4-5 cents over Chicago's, a
A marketer was unsure whether to expect more softness today
"because the screen seems to have found a bottom at $2.26
[Thursday]." But another marketer wasn't hesitant about predicting
further price declines, citing mild weather overall and the usual
dropoff in weekend gas demand.
One source expects a good number of deals done today to be made
for gas flow through the middle of next week as a large part of the
trading community prepares to attend the GasMart/Power '99 trade
fair in Dallas Monday through Wednesday.
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