Several sources had expected cash prices to stay put for themost part Wednesday until the AGA’s storage report was released inthe afternoon, but they were fooled. Instead, buoyed by a firmerscreen during the morning, cash got a head start on the subsequentbig futures run-up by rising about a dime or more at nearly allpoints.

Last week Nymex traders seemed to go against logic, rewarding areport of a rare reduction in the year-on-year storage deficit byturning a previously softer screen into a gain of nearly a dime.Yesterday’s bullishness (the July contract went up more than aquarter) seemed more appropriate, as AGA’s figure of 64 Bcfinjected last week signaled the return of a growing deficit.

Storage and futures were the big stories Wednesday, sourcessaid. Weather isn’t much of a factor in the cash market for now,one noted. The Southeast and desert Southwest are about the onlyregions with temperatures hot enough to incite significant airconditioning load, and the Southeast is a bit on the mild side forWednesday’s official start of summer.

Cash numbers trended higher in virtually all markets as morningtrading proceeded, based largely on screen support. A few scatteredpoints managed to register only small upticks, but they weregreatly outweighed by the double-digit increases.

Once again, all-day trading in the intra-Alberta market gotfirst crack at reacting to the futures jump. A Calgary marketerreported deals from the mid C$4.90s through the mid C$5.10s,representing rises of C30 cents or more from Tuesday. An electronictrading service had an even larger range of C$4.85-5.20, she said,and the late afternoon bid-ask spread was C$5.18-23.

It’s safe to assume that Wednesday afternoon’s futures strengthwill be reflected in further sizeable advances in cash pricestoday, several sources said. July basis has been fluctuating backand forth with recent screen movement, according to a Gulf Coasttrader; yesterday it was widening again (that is, minus basisnumbers were getting bigger).

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