The surge that has characterized cash trading activity this weekcontinued Wednesday but at a significantly slower pace, suggestingto some that prices had reached or were nearing peaks. The newupticks left most eastern points in the vicinity of October indexlevels, while markets in the West padded their already considerablestandings above indexes.
Intra-Alberta was one of the rare markets already seeing someprice retrenchment Wednesday. Numbers were off by about C5-6 centsand continuing to fall in something like a panic sell-off after theAGA report estimated 58 Bcf of storage refill last week, a Calgarysource said. That was considered pretty bearish in Alberta, wherepeople have been pushing hard in recent weeks to top off theirstorage accounts, he said.
But a Houston marketer called the storage report right on themoney. “Prices during the past week were the lowest so far thisyear, giving incentive to put every possible molecule into theground,” he said.
Electric generation demand remained a major factor in drivingWestern prices higher, a marketer said. That was especially so forone utility that reportedly was not receiving the hydropower it hadexpected, he said. However, another source thought traders payingback imbalances accrued last month had as much, if not more, impacton Western gas markets than power load.
Transco Zone 6 deliveries in the Northeast started out strong,fell back a bit and then rebounded as a lot of buyers in the areaseemed short on gas, one marketer said.
A Texas source felt the big price increases earlier in the weeklikely were due to people building up supplies in advance for acold front that is expected to reach the Dallas-Fort Worth areatoday. But they were scaling back their purchases Wednesday afterforecasts changed to “not as cold as first expected,” she said. AHouston trader agreed, saying the forecasts had “really blown theintensity of this cold front out of proportion.” Earlierpredictions that temperatures would dip into the 30s in parts ofTexas now have been ratcheted up to the high 40s and low 50s, headded.
A large marketer in Oklahoma reported getting a lot of callsabout November business already. Prices for next month look prettystrong at this point as there seems to be a “perceived shortage”developing, she said. Another trader reported hearing an ElPaso-Permian offer at $2.12, but that was when the screen was at$2.23, so she expects cash prices in the Permian to be lower thanthat. A Calgary marketer is doing intra-Alberta deals for Novemberin the mid C$2.70s.
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