Cash prices came out of the chute fast Monday morning as coldertemperatures, strong NYMEX prices and a bit of hype tricked mostmarkets into early gains. “A buyer blinked early this morning andsellers took control,” a Tulsa marketer said. The early strengthpushed prices to 5-8 cents above index levels in some cases.However, after the market caught its breath, sellers came out ofthe woodwork to send prices lower and late trades were back nearindex levels. Western prices followed the East’s early lead butresisted the major downturn.
“If this weather gets any nicer we’re headed back to $3.00,” aTexas producer half-joked. However, he admitted although Februaryproduced some favorable prices in the face of relatively mildweather (see graph page 1), March might be hard-pressed to repeatthe performance. “We were extremely long gas in February and thatturned out to be the right call, but we took a more conservativeapproach to March,” he continued.
A Midcontinent trader lamented he wasn’t a bigger seller earlyin the day when, “the market was feeding on hype.” He suggested thesubsequent falloff was not uniform across all pipes. “ANR Southweststill seemed short even when you were trying to give gas away onneighboring pipes.” He also noted ONG may be giving up its positionas price leader in the Midcontinent. “All those that got burnedhaving to pay up for ONG supply in February have assured they willnot be caught short in March. Nearly all available capacity ontoONG from the intrastates is filled for March.”
Rockies prices, up by a dime or more from March index levels,had some Western traders scratching their heads. One Marketer wasbetting on gas to get backed up causing Rockies prices to come offMonday due to scheduled maintenance at the La Plata CompressorStation on Transwestern Pipeline. She traded Northwest gas as highas $1.98 but heard as high as $2.00. Another source thinks thattoday might bring lower prices in the Rockies. “Rockies ran thismorning due to weather demand and also in sympathy with theMidcontinent and El Paso Blanco. We saw a small turnaround late butnot to the extent experienced in the East. I’d say tomorrow couldbring some softening for domestic Rockies prices.”
©Copyright 1998 Intelligence Press Inc. All rights reserved. Thepreceding news report may not be republished or redistributed, inwhole or in part, in any form, without prior written consent ofIntelligence Press, Inc.
© 2020 Natural Gas Intelligence. All rights reserved.
ISSN © 1532-1231 | ISSN © 2577-9877 |