Except for OFO-inspired upticks in Northern California, the restof the cash market was on a downhill track Tuesday following theholiday weekend. Most declines were in the range of 20-30 cents,but tended to be larger in the Northeast and got as high as about70 cents at the Southern California border.

Outside of nighttime temperatures reaching zero or less in partsof the Upper Plains/Midwest region and another cold stormapproaching the Pacific Northwest and Northern California from thePacific Ocean, there was little weather impact on the market,although a producer expressed surprise that Midwest citygatesjoined the overall softness despite area conditions. However, amild near-term weather outlook in most areas, a falling screen anda growing comfort level with the storage situation were enough todrive prices down, sources said.

A customer-specific OFO for today by PG&E (see Transportation Notes) produced increases ofslightly more than a dollar at the PG&E citygate and a few centsat Malin. The utility’s OFOs always seem to have much greater impacton citygate numbers than at Malin, a marketer said.

Despite the Midcontinent downturn, prices were rebounding asmuch as a dime in late deals, a couple of traders said. A marketersaid that was due to the Upper Plains freeze being due to sweepthough Kansas into Oklahoma and the Texas Panhandle overnight;temperatures were falling quickly in the Tulsa area Tuesdayafternoon. “If that weather hadn’t been coming in, I think[Tuesday’s] price slide would have been even bigger,” he said. It’shard to tell if it will be enough to rally Midcontinent pricingtoday because the front may pass through too quickly for mucheffect, he said.

A producer also attributed the late Midcontinent strength atleast partly to Rockies gas preferring to seek the better values inCalifornia prices rather than head east into the considerablyweaker Midcontinent/Midwest market. Toward the end of trading itwas virtually impossible to coax any gas off CIG into PanhandleEastern, he said.

Although Southern California border numbers registered the day’slargest drop under “beautiful” weather in the area, as a marketercommented, they remained the most expensive market by far,outpacing the next-highest PG&E citygate by more than $10. It’sthe perception of colder weather moving into the northern part ofthe state and SoCal Gas’ new 90% daily balancing rules keeping theborder market high, one source said. However, despite the morerigid balancing setup, nobody seems worried about running out ofSoCal Gas storage, he said. “Right now we’re just getting ‘biscuitburns’ in the early morning and late evening,” he added, explainingthat “biscuit burns” was a colloquialism he grew up with thatrefers to putting biscuits in the oven for breakfast and again forsupper.

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