Follow-through on last week’s gains and record-settingtemperatures put bulls squarely in control Monday in the Nymex gaspit. Locals and commercials were good buyers in the first hour oftrading yesterday as they buoyed the market to its highest level insix months. However, after the initial surge the market could notattract fresh buying and was left to chop sideways amid arelatively light 59,236 in estimated volume. The July contractfinished at $2.442, up 0.5 cents for the day.

A Gulf trader was surprised the futures market was unable totack on more substantial gains in the face of spiking physicalpower and gas prices. Transco Zone 6 NY prices for today’s deliverytraded as high as $2.86 and Nepool power prices were quoted as highas $1,000.

However, a Houston-based marketer felt natural gas prices “weresimply playing catch up” Monday after having lagged the futuresmarket for the first part of June. Looking ahead, he feels becausecash prices have narrowed the gap the burden now lies on thefutures market to make the next move.

If futures are able to press higher, the July contract willencounter resistance at $2.50, ahead of more selling up to $2.64,according to New York-based Pegasus Econometric Group. On thedownside, support exists at $2.36.

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