In contrast to a softening screen, cash prices were higher across the board Monday. Gains mostly were in the low to mid teens, but ranged from slightly under a dime for Malin and Sumas to about a quarter at Northeast citygates.

The Northeast is experiencing enough winter weather to justify regional citygates leading the post-weekend market surge, a large marketer said. That didn’t appear to be the case in other areas, he continued, but to him the overall upticks “primarily were a delayed reaction to the screen waiting until cash trading was finished Friday before strengthening that afternoon.”

Don’t expect quotes to continue firming today, a Midcontinent trader cautioned. Not only were futures down by double digits Monday, he said, but outside the Northeast and Rockies, weather remains too mild to be conducive to further price advances. He noted that Northern Natural Gas had declared an OFO for all market area zones today and Wednesday to guard against excessive linepack (see Transportation Notes). The trader also said buying interest appeared to be weaker Monday than a week ago.

Although several other traders agreed that the screen softening and general lack of cold weather demand were likely to push the market lower today, one eastern source wasn’t so sure. He was impressed by the ability of cash quotes to move higher in the face of serious futures weakness, and said they might be able to do so again for one more day.

A Gulf Coast marketer observed that even with a lot of convergence resulting from rising cash prices and a falling screen, the cash market was still relatively soft compared to the January futures contract. “We’ve still got a ways to go there [convergence],” he said. The marketer said Henry Hub numbers were essentially even with swing swaps in the mid $2.50s Monday, unlike on Friday when cash had run about 20 cents behind the swaps, which in turn were about 20 cents under the screen.

Several sources reported getting a mixed picture about how much January business will be “frontloaded;” that is, done this week prior to the traditional last-five-business-days bidweek period. One marketer planned to finish up this Thursday because he believes many in the trading community will want to take the workdays between Christmas and New Year’s off for vacation. But an aggregator, although conceding he expects “a lot” of January deals to get done Thursday and then “a few more” Friday morning before nearly everyone leaves the office early for the long holiday weekend, still expects post-Christmas bidweek trading to be brisk. After all, he observed, who would want to commit to a January market strategy up to a week before new near-term weather forecasts and storage data become available?

A Rockies marketer said Monday he was aware of quite a few January deals already being done, but everything was indexed with no fixed prices being quoted.

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