Prices continued to fall almost across the board Friday, which was hardly surprising because a pattern of weak weather fundamentals remained in place, June futures dropped more than a nickel in their prompt-month debut, and gas demand typically goes down over a weekend period.

Declines between about a nickel and 20 cents occurred at most points, with a majority being in the vicinity of a dime. Malin and the California border-SoCalGas saw steeper plunges, but some Rockies/San Juan points along with the PG&E citygate ranged from flat to barely lower, and the border-PG&E managed to register a gain of more than a dime. PG&E did not issue an OFO, but the fact that its linepack is hovering around minimum target levels probably caused the pocket of relative western firmness, one trader said.

While PG&E linepack was on the low side, a few Gulf Coast pipes continued to experience problems with high linepack. A Tennessee OFO remained in place. Florida Gas Transmission advised shippers that a combination of mild market area weather and high overall linepack left it “unable to allow normal levels of market area underburns;” therefore, they should watch for the potential issuance of an Underage Alert Day for Saturday’s gas day. And Sonat, while judging it “unlikely” that an OFO would be declared Saturday for long or short imbalances, said it was “too close to call” on long imbalances for Sunday or today.

“We’re in a ‘wait-and-see market’ right now,” said a Gulf Coast trader. “I’m hearing from some people that think prices will go up during May and from others that think they will go down.” As might be expected, an East Coast utility buyer was in the latter camp. “We’re hoping gas prices will keep dropping enough to get competitive again with fuel oil,” the buyer said. He estimated that currently in the Northeast market, gas remains about 75 cents/MMBtu more expensive at the burnertip than fuel oil.

May pricing saw little significant change from earlier numbers, according to a Gulf Coast marketer. Outside of California, he and others generally reported May numbers that were lower than Friday’s late-April swing levels.

©Copyright 2001 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.