In what was largely believed to be a follow-through from Friday’s erratic screen rise of nearly 16 cents, cash prices saw strong gains Monday that hit double digits at a majority of points and were especially pronounced in the heated West. Eastern upticks tended to range from about a nickel to a little more than 20 cents, while some western points fit within the East’s pattern and others soared by as much as 40-60 cents or more.

But as a Gulf Coast marketer pointed out, just as the gradual push higher in futures Friday carried over into the Monday cash market, much of Monday’s screen dive of almost a quarter came too late to influence that day’s physical deals but can be expected to be felt in softening numbers Tuesday morning. He also noted that the Friday market had gotten a little boost from the forecast of a potential Tropical Depression Eight developing from a tropical low-pressure system in the middle Atlantic. However, no Atlantic tropical activity was showing up on the market’s radar screen Monday.

One source said the post-weekend return of industrial load accounted for part of Monday’s higher prices. Also, although early-August weather is still unseasonably mild in much of the Midwest and Northeast, their prices couldn’t help but be driven higher by rising Gulf Coast numbers. Gulf points were finding more power generation load than last week as 100-degree-plus highs descended upon a big swath of West and North Texas, and highs around 90 degrees were spreading to more northerly parts of the South.

A Midwestern trader commented on the geographic diversity of price advances Monday: “It has been a lot hotter out West, so I’m not surprised at those western points’ strength. But it is still very mild in middle America and for the next five to 10 days there isn’t going to be much change.”

For a western marketer, the fact that cash prices shot up even with the screen down meant “the run-up was fundamental-based for sure. It’s hot in Texas. Utilities are buying gas up fast.” However, “What was up with Opal?” he wondered about the Rockies point “screaming up” almost 70 cents. “Our Rockies guys were off today, so I guess they missed out on all the fun.”

But the Opal spike and corollary Rockies strength could be easily attributed to major Williams Field Services maintenance scheduled for Tuesday through Thursday at the Opal Plant, which will cause a supply shortfall of slightly more than 600 MMcf/d, not including the effect of simultaneous work on the Jonah Field gathering system behind the plant (see Daily GPI, July 30).

Lehman Brothers analyst Thomas Driscoll forecasts a storage injection of 85 Bcf for the week ended Aug. 1. Kyle Cooper of Citigroup said his “final” estimation is for a build of 75-85 Bcf in Thursday morning’s EIA report.

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