Daily GPI / NGI All News Access

Bidweek Quotes Fall Slightly After Screen 'Meltdown'

Bidweek Quotes Fall Slightly After Screen 'Meltdown'

For a while Thursday it looked like August prices would keep running higher based on a strong screen, continued heavy power generation load and Wednesday afternoon's super-bullish storage report. However, the uptrend crested and began subsiding a bit when a late "meltdown" occurred in September futures, sources said.

Naturally buyers and sellers held differing opinions about the mild reversal in bidweek numbers. A western buyer said he held off Thursday after the previous evening's run-up in Access futures activity, "but now that the screen is back down about 15 cents, I will probably step out and buy some more [today]." A Midcontinent producer, on the other hand, said most Panhandle Eastern deals had been done in the mid $2.50s, but some folks were looking for gas in the mid $2.40s after Thursday afternoon's downturn. However, in his perception "there seems to be a good deal of demand left out there, and I expect prices to start coming back up" this morning.

An industrial buyer reported experiencing "sticker shock" at having to fork over $2.60 for a Houston Ship Channel package. Even with prices subsiding slightly Thursday, he said, they still seem steep both for August and for the November-March offers he is getting.

Looking ahead to the aftermarket, a Midwest marketer is expecting lower prices. Saying he expects the Chicago citygate index to be around $2.69-70, he added, "Given the choice, I would rather be short from $2.70 than long."

Except for a small touch of Rockies/San Juan flatness, it was onward and upward again in the late-July swing market. Most points ranged from a nickel to a dime higher, boosted both by the small storage injection report and the intense heat wave dominating most of the U.S. except for the West Coast. Futures pricing was supportive, also, since it didn't take a dive until after cash trading was over.

Electric utilities again struggled to meet customer demand, especially in the Midwest, where Chicago and Michigan citygates rose by almost a dime. Many power generators continued to break recently set load records. The PJM Interconnection independent system operator issued a hot weather alert for Thursday through Sunday and at mid-afternoon Thursday issued a "Request to Purchase Emergency Energy." Florida Gas Transmission issued an OFO due to heavy market-area demand.

No letup in the heat is in immediate sight. Utilities such as Cinergy in Ohio and Consumers Energy in Michigan asked their customers to maintain their energy conservation efforts through today.

Thursday's market suffered from another kind of trouble as traders who used Altrade's electronic trading system were cut off for about eight hours, from 12:15 CDT until about 8 p.m. CDT. A spokesman said those cut off represented about 50% of traders using the system. Altrade's system had been carried through Internet provider IBM, who chose yesterday, the heaviest gas trading day of the month, to transition its system over to its new owner, AT&T.

Customers who use Altra's direct connect system were not affected. All Internet-based orders were put on hold to protect those users who were disconnected. Altrade has been assured the problems are corrected and trading should proceed as usual today.

©Copyright 1999 Intelligence Press Inc. All rights reserved. The preceding news report may not be republished or redistributed, in whole or in part, in any form, without prior written consent of Intelligence Press, Inc.

ISSN © 2577-9877 | ISSN © 1532-1231
Comments powered by Disqus