Cash prices finally experienced some retrenchment Thursdayfollowing an awe-inspiring series of growth spurts during May, buta near-total collapse of the screen along with the usual dropoff inweekend demand is expected to result in significantly greaterdeclines today.

Thursday’s drops mostly ranged from a nickel to about 15 cents,with those in the vicinity of a dime being predominant. The degreesof softness were pretty well mixed among the various market regionsexcept for intra-Alberta. One Calgary source reported trading allthe way from the mid C$5.50s down to the low C$5.20s, while anothersaid he saw an electronic trading screen go from C$5.70 down toC$4.80. Intra-Alberta business, which goes on all day, is moreimmediately susceptible to big screen drops such as Thursday’scollapse of nearly 30 cents.

Several sources who were asked why the screen was acting sobearish after AGA’s report of further growth in the year-on-yearstorage refill deficit, tended to go along with a Texas marketerwho said, “I’ve got no idea; I’m just riding the priceroller-coaster.” However, one suggested it was mostly a case ofprofit-taking. Another tended to support that with this theory: TheNymex fund traders want to lock in their profits now even if itcosts them something later. They probably have customerdistributions to make at the end of June and want thosedisbursements to be nice. “We’ll see if they’re bidding it back upby next bidweek,” he added.

An eastern utility buyer chimed in, “Maybe we’ll see in a monthor two that they [Thursday’s futures sellers] made a mistake inliquidating long positions if the screen hits $5 or more.”

Meanwhile, Northeast weather was a bit uncomfortably warmThursday and likely to remain so today but due to cool off againthis weekend. The Midwest already was getting chilly as a coldfront moved into the area.

In contrast, it was very hot and humid all the way from Texasand Oklahoma through the Southeast, and that created fairly strongpower generation demand in the Gulf Coast, a Houston-based traderreported. In addition to utility sales, “that radical screenchange” aroused some extra demand for storage injections, he said.

A western marketer said rising temperatures in NorthernCalifornia helped limit Malin and the PG&E citygate to some ofThursday’s smallest price drops of about a nickel.

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