Most of the cash market experienced relatively minor weakness Thursday with prices ranging from flat to about a dime lower. The bottom was falling out in the Rockies (and to a lesser degree in San Juan Basin), however. Even with some snow showers occurring in mountainous areas from Wyoming to the Pacific Northwest, Rockies gas continued to succumb to slipping demand and transportation/storage constraints.

The moderate softening in the general market had been expected after a higher-than-expected storage report Wednesday afternoon accompanied by a bearish Nymex reaction. Initially higher futures Thursday had little influence on cash, sources said. Rather, it was the storage factor and generally fair weather (not counting precipitation) nearly everywhere that led to lower numbers, they said.

But all that meant little to Rockies traders who saw quotes plunge to less than a dollar on CIG and Questar, and to an even dollar on Kern River and at the Cheyenne Hub in hugely volatile dealing. Prices started at their daily highs and tumbled all the way to their bottom ends near deadline.

The reasons for such extreme Rockies weakness weren’t readily apparent to everyone. But a couple of sources cited continuing allocations of injections at Questar’s Clay Basin storage facility as playing a part. Also, the Trailblazer outlet for Rockies gas seeking a Midcontinent/Midwest market was constrained again. The Station 602 bottleneck on Trailblazer had cleared up Tuesday, one marketer said, but then a compressor problem developed there again.

Trailblazer has tentatively scheduled the in-service date of its expansion for May 1, but that was becoming somewhat uncertain. New compressor Station 601 (Logan County, CO). and a new unit at existing Station 602 (Lincoln County, NE) are in the process of coming online, the pipeline said. Another new station (603 in Kearney County, NE) has experienced some delays and did not begin testing until Thursday, it added. Testing of all three stations will continue and could impact the in-service date.

A San Juan trader said, “We were kind of batting the question around ourselves about why the basin was so weak. The problems with getting into Clay Basin probably were part of it.” He saw the San Juan plunge of about 40 cents as largely a chain reaction after-effect of the Rockies weakness as gas from that region sought a home anywhere it could find it. “The first San Juan bids were at $2.50 and then sank from there. Somebody hit the $2.50, we went into another room for a few minutes, and came back to find the next one was $2.30. Not long after that the price was $2.00.”

Back in other markets, a Northeast marketer said it looked like a “false start this morning” when the screen was up before turning negative after cash trading was finished. “The harsh reality of the AGA report was bombing this baby into submission during the afternoon. There’s no weather in sight; it’s just weak fundamentals all around.” He sees May as a “slow and boring market. It won’t have either the cold of winter or the heat of summer.”

A Florida buyer, noting the end of Florida Gas Transmission’s OFO-like Overage Alert Day restriction even with very warm temperatures remaining in the state, commented that “maybe its linepack wasn’t so low after all.” She went on to speculate that it probably wasn’t lower demand that ended the restriction, but rather suppliers putting more gas into the pipe in the second day of falling prices.

A marketer said Rockies fixed prices for May were also diving, although not to the extremes of swing gas. He quoted the Rockies in general around $2.10 Thursday and said that compared with the $2.90 area two days earlier. Sumas was on either side of $2.70 for next month, he added.

An aggregator supplied these basis quotes for Northeast points (all plus): Dominion 17 cents, TCO 15 cents, Texas Eastern M-3 28 cents, Transco Zone 6 (non-NYC) 27 cents, Zone 6-NYC 30 cents, and Algongquin citygate 30 cents.

A utility buyer observed, “I’m not really eager to try to finish May business before the weekend, but may be forced to. So many others want to get it over with quickly because of [the Houston Energy Expo trade fair] starting Monday.” He did not plan to attend the expo.

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