Plunges in New England citygates and mild firmness in the Rockies constituted the extremes in an overall market Tuesday that saw most points range from flat to down about 20 cents. A solid majority of the declines were small at less than a dime.

Once again sources found it a tough call on short-term price movement. Generally weak weather fundamentals were essentially unchanged from the day before, they pointed out, but the screen was rebounding by nearly 20 cents as forecasts were adjusted once again to indicate that heating load might see a considerable jump before the weekend arrives. The natural gas futures rally was in sharp contrast to further big drops in crude oil and heating oil, with crude falling nearly a dollar and settling only a few cents over $31/bbl.

Despite being the only remaining repository of substantially cold weather, the Northeast recorded Tuesday’s largest cash drops, including downturns approaching a dollar in New England. “At least it’s stopped snowing today [Tuesday], but we’re due for some more on Wednesday,” said a utility buyer in the region. It’s hard to put much faith in the weather reports any more when they keep shifting so much, she added, “but I’ve got to believe it’s the new forecasts” that were driving natural gas futures even while the oil contracts keep dropping.

A Midcontinent marketer agreed about both the slippery nature of recent forecasts and also about them being responsible for Tuesday’s Nymex gain. “I suppose Wednesday they [forecasters] will decide it’s actually going to get warmer again, and then the screen will do another turnaround,” he commented wryly. Another Midcontinent trader’s feeling was “this is madness. [Nymex] prices are over five bucks and we are going to be have record highs tomorrow.”

A Midwest trader quoting Chicago in the mid $4.70s said he found it hard to see what Nymex based its gain on, since only the Northeast had any serious weather still around. Prices were high enough Tuesday in the Gulf Coast and low enough at the Chicago citygate “that you could make more money hauling Midcontinent gas south instead of north,” he said.

Intra-Alberta was among the few stronger markets, along with the Rockies, despite provincial temperatures staying mild. A Calgary marketer said his early-morning numbers started in the high C$5.90s and dropped about a dime from there, but rallied along with the screen to as high as C$6.05 after he had finished trading. A Rockies trader said prices there were up slightly, but he didn’t “really see any reason why.”

Salomon Smith Barney analyst Kyle Cooper estimated a withdrawal of 98-108 Bcf in EIA’s storage report Thursday morning. His counterpart at Lehman Brothers, Thomas Driscoll, looks for a pull of 110 Bcf, which he said was 5 Bcf higher than his original estimation.

©Copyright 2003 Intelligence Press Inc. All rights reserved. The preceding news report may not be republished or redistributed, in whole or in part, in any form, without prior written consent of Intelligence Press, Inc.