Very hot weather along the East Coast and in the South and much of the West kept prices moving higher at nearly all points Tuesday. Transco Zone 6-NYC soared again, this time by 80 cents, and peaked at $6.

Most gains were between about a nickel and 20 cents, but several Rockies points rose even more than 20 cents. They were experiencing strong power generation load from a heat wave that has had the desert Southwest baking in triple-digit temperatures for weeks, but now also extends through inland California as far north as Oregon.

The heat index in the New York City was 107 degrees, a marketer said. Northeast prices were coming down at the end of trading, but he doubted it will lose much more ground on Wednesday. Transco Zone 6-NYC will be in a tighter range but still expensive, adding, “Non-New York was particularly tight today, especially when you look at the huge range [two dollars] at the NYC citygate. They just don’t play off each other like they used to.” He noted that storage on Appalachian pipes Columbia and Dominion is more then 80% full.

A Northeast utility buyer observed that Iroquois Zone 2, while not hitting the heights of Zone 6-NYC, has been at a premium recently over comparable points such as Texas Eastern M-3 and Transco Zone 6 (non-NYC). He attributed the higher Iroquois pricing to it being a summer peaking pipe, as opposed to the other two, which tend to see their top prices in the winter. “Iroquois has a very high load factor for electric generation “because it serves a lot of gas-fired power plants built along its path, the buyer said.

“The heat is not in the Midwest,” said a marketer. “The East Coast is getting what we had a few days ago” in the central U.S., he said, but added that even though a weak cold front is keeping the Midcontinent/Midwest relatively cool, regional prices are getting pulled higher in a convergence effort caused by competition for supply with the premium numbers in the East.

Transco Zone 1 pool (Station 30) was the only point not to rise nearly a nickel or more. After trading at a premium to all other South Texas points except FGT Zone 1 as recently as Monday, Station 30 returned to discount status again temporarily, as the pipeline, citing ongoing commissioning work associated with recently completed construction at Station 35, said no IT would be available through Station 40 Wednesday and Thursday (see Transportation Notes).

Opinion was mixed on how long the cash upticks will continue. A Gulf Coast marketer said it seemed like momentum had built up for rising prices, “so I guess they’ll keep going up as long as the Northeast stays hot. Rain has cooled things off a bit in Texas, but all the Gulf Coast utilities I talked to say they are still burning plenty of gas. I haven’t really seen any significant drop in power generation load.

However, another marketer pointed to natural gas futures, which wavered on either side of flat Tuesday before eventually posting a 1-cent gain after having risen by 20-plus cents the day before. Because of the Nymex slowdown, he sees a chance for a “slight dip” in the cash market Wednesday.

Other than small advances in the West’s SP-15 and Mid Columbia pools, most power prices for Wednesday delivery were falling on the IntercontinentalExchange (ICE) online trading platform. The two highly conspicuous exceptions? Nepool (New England) and PJM-West, of course. Nepool was up nearly $50/MWh to the $110-130 range, ICE said, while PJM-West rose by a little less than $25 to $89.00-96.50.

A Canadian producer had one indication that this week’s bullishness hasn’t faded yet: his next-day intra-Alberta sale was in the mid C$3.10s while same-day deals ranged throughout the C$3.00s. Same-day gas hit its high early, fell nearly a dime and then came back up, he said. September prices continued to inch up; the producer reported intra-Alberta for next month in the mid to high C$3.20s Tuesday, slightly higher than C$3.24 deals quoted Monday.

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