Prices leveled off Tuesday in the East with few points varyingby more than a couple of cents in either direction from flat.Western markets generally were softer except for flat numbers inthe Pacific Northwest and a gain of more than a dollar at theSouthern California border. The Golden State’s power situationremained dire enough that a second straight day of rollingblackouts was ordered (see related story).

There’s virtually no demand to speak of, not even storage,according to an intrastate Texas trader. “We started a little shorttoday [Tuesday] but couldn’t get anything worthwhile going” exceptfor an indexed Agua Dulce deal, he said.

A Gulf Coast producer thought the gradual April futures rise ofnearly a quarter, and possibly the lack of eastern softness, wasrelated to the development of colder weather than many forecastershad expected. It’s not like there are any blizzards happening, butthere are some reminders of winter hanging around just after theofficial start of spring yesterday, he said. He saw a decent chanceof cash using Tuesday’s screen strength as a springboard formoderate firmness today.

Declaring he was “bullish on summer prices,” a Midcontinentproducer reasoned that with all the range-bound pricing the markethas seen recently, “I have to believe we’re at or near the bottomof 2001 pricing.” He noted that except for March 2002, the Aprilcontract occupies the lowest rung of Nymex’s 12-month strip.

Declines in the Rockies and Southwest basins mostly ranged fromabout a nickel to 15 cents. But once again it was Malin and thePG&E citygate taking the day’s biggest price hits as the big dualutility expanded what had been a customer-specific high-inventory OFOinto a systemwide one with a low tolerance for positive imbalances(see Transportation Notes). “Wekind of knew the systemwide OFO was coming because of their[PG&E’s] projections of increasing linepack in the next two tothree days,” said a large aggregator.

But the California border continued to widen its spread with theSouthwest basins by soaring to an average of just over $11. Unlikethe excess gas situation in the northern part of the state, amarketer said, border supplies were welcomed to help combat theshortfalls in power generation.

Looking ahead to April, a producer reported buying in NGPL’sMidcontinent pool at $5.05, “which was at minus 9 cents basis whenthe screen was at $5.14 early [Tuesday] morning. I wish I couldhave bought more at that point since the screen later went morethan a dime higher.”

Another trader quoted April basis of plus $5.00 at the SouthernCalifornia border.

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