To the surprise of absolutely no one, cash prices plunged acrossthe board Tuesday. It was an easy call to make considering theresidual effect of Monday afternoon’s steep screen dive and warmingweather trends that are likely to get even warmer next week,sources said.
“Who knows, the groundhog might have gotten it wrong last week,”said an aggregator who trades the Northeast. “Maybe winter is overafter all.” A buyer in the region said afternoon temperatures werearound 30 degrees, “but it’s a ‘comfortable’ 30 degrees.”
There was substantial price change variety in the market’sdownhill slide. Declines ranged from around a dime in California,the Rockies, intra-Alberta and scattered Gulf Coast andMidcontinent points to more than 20 cents at other Gulf points andto nearly 50 cents on Appalachia’s CNG. Then there was theNortheast, which has had little connection to the “real” market forseveral weeks now. Price drops there were again in the tripledigits, topped by a plunge of about $2.50 at Transco Zone 6-NYC.
There was also some disparity in late price movement. ANortheast trader who chose to baseload several packages said priceskept going lower after he made his purchases. But a couple ofsources were seeing mild rebounds in late deals at several westernpoints when futures started coming back up.
The new weather reports came out and “crushed everything in thegas market,” an aggregator commented. Everything seemed to benegative, he said: warmer weather, a lower screen and also lowerswing swaps.
A Gulf Coast marketer reported about half of the estimated 400MMcf/d of associated gas shut in because of the offshore Poseidoncrude oil pipeline outage came back on-line over the weekend (seeDaily GPI, Feb. 7).
A western marketer noted that the spread between Malin and thePG&E citygate widened considerably to nearly 30 cents with thestart of maintenance on the utility’s Tionesta Station that will limitMalin capacity through Feb. 19 (see Daily GPI, Feb. 4). That kept the value of “gate”deliveries from falling as far as Malin quotes, he said.
One trader said he couldn’t be sure how plans for NOVA to abandonits long-established “postage stamp” transportation rate and switch todistance-based tolling (see Daily GPI, Feb. 8) would affect him until he’s had achance to study the details. However, he said, “it will probably be aneutral change for our small amount of production in central Alberta.”His company makes just about all of its purchases at NIT (NOVAInventory Transfer), and those are kind of homogenized pricesreflecting gas from all over the province, the trader added.
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