Lack of activity was the popular excuse for the mostly stagnantprice levels during Monday’s cash market trading session. Mostsources agreed that moderating temperatures along with aslow-moving Nymex screen were to blame. With the exception of theRockies and intra-Alberta gas, which registered the only notabledeclines of the day, cash prices generally started the new weekflat to up or down a penny or two across the board.
Rockies gas traded anywhere in the $2.08-20 range and finishedthe day averaging about 8 cents below Friday’s levels. “I think alot of [the decline] was driven by the fact that a lot of peoplegot caught up on their imbalances on the pipelines,” one sourcesaid. “In addition, we saw a net storage injection of into ClayBasin on the 19th, which meant there was plenty of gas to goaround,” he added. While the injection was only an estimated 40,000MMBtu/d, it came in sharp contrast to recent withdrawals in the125,000-200,000 MMBtu/d range. However, the marketer feels thatonce people see this price weakness “they will start gobbling upthe gas” to put into Clay Basin and we should see prices sustaintheir current levels. One source who reported Questar prices as lowas $2.06, said they had regained a little of their losses later inthe day.
One bearish Rockies trader expects the weakening trend tocontinue as higher temperatures are expected to roll into theregion. The National Weather Service forecast a high of 80 degreesin Denver by Wednesday.
Intra-Alberta prices also saw about a C7-cent decline fromweekend levels largely due to warming temperatures in the region.Sources reported 60-degree temperatures in the Calgary area. “TheAlberta market is finally starting to soften,” one source said.
A Gulf Coast marketer said cash prices in Texas and Louisianastarted up a penny or two but then seemed to flatten out. “Weactually saw some Texas pipes slip a penny or two below weekendprices around nomination deadline. It seemed like all the gasmoved, but it just didn’t seem like demand was quite as good as wesaw last week.” He added that with the screen simmering at itscurrent depressed level, there is no incentive for cash to run.
Midcontinent deals were done about a penny on either side of$2.30, sources reported. “Neither buyers nor sellers were veryaggressive,” one marketer noted. “I don’t see a whole lot ofinterest in the utility segment trying to buy gas, but then theredoesn’t seem to be a whole lot of gas out there looking for a homeeither,” he added. “We’re below normal and have been below normalfor a week in Tulsa,” said another source. “But below normal inTulsa is temperatures in the upper 50s to the low 60s, and thatreally doesn’t create any demand on either side of the picture.”
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