Cash prices emerged from the weekend in a general softening trend Monday, but with some flat to higher numbers in the West mixed in and a sense among a couple of sources that the market is still relatively strong. Northeast citygates plunged while the rest of the East mostly fell between a couple of cents and about 15 cents.

San Juan Basin recovered most of its weekend drop of nearly half a dollar. California, Permian Basin, Rockies, Pacific Northwest and Western Canada points rounded out the mix with flat to moderately higher showings.

Algonquin citygates led the overall path downward by plummeting more than a dollar and a half. A utility buyer said a restriction at the pipeline’s upstream-end Southeast Compressor Station, which had generated a sizeable premium for alternate New England deliveries from Maritimes & Northeast at Dracut, MA last week, was resolved over the weekend, thus easing the region’s supply pinch.

Northeast temperatures remained very cold Monday but were due to moderate a bit Tuesday, another trader said, calling them “average temps for December.” Monday’s big market-area declines considerably tightened production area/citygate spreads, he noted.

Midcontinent/Midwest prices tended to see some of the East’s larger non-Northeast drops. A Midwestern utility buyer, quoting Northern Natural-demarc in the high $4.00s, said the weather had gotten mild enough since last week “that we’re selling gas today instead of buying.”

A Florida utility buyer wasn’t exactly happy to hear that another pigging of MOPS, which often causes a temporary shutdown of deliveries into Florida Gas Transmission, is scheduled for next week (see Transportation Notes). However, he conceded that there’s almost never any problem replacing the package that he regularly sources from MOPS at other FGT Zone 1 points.

Alberta temperatures were relatively “mild” at slightly above freezing, said a Calgary-based producer quoting same-day intra-Alberta numbers in the low $5.30s. The Aeco market is fairly flat right now, the producer said, and he expects it to remain that way until the EIA storage report comes out Thursday. Referring to earlier forecasts of a warmer than normal second half of winter, he pointed out that prominent meteorologist Jon Davis of Salomon Smith Barney (SSB) is now calling for a full “normal” winter. That leaves open the possibility of a storage pinch being towards February after all, he concluded.

SSB analyst Kyle Cooper’s final estimation of this week’s storage report is for a withdrawal of 148-158 Bcf, which would compare with pulls of 17 Bcf a year ago and 55 Bcf in the five-year average. Meanwhile, Thomas Driscoll of Lehman Brothers is a bit more conservative, predicting a withdrawal of about 120 Bcf.

Whichever way it goes, a Gulf Coast/Northeast trader is sure of a “big” withdrawal this week, “so prices may hang out up here for awhile, even with the weather warming up.” He went on to say that if New England points keep falling like they have recently, they might be “reasonably priced” by Tuesday. Sounding somewhat contentious, he added, “The pipes control everything and as long as the FERC still pays out the way they do, there is no incentive for pipes to flow the maximum return. When you have the option of posting restrictions whenever you feel like it (admittedly, some of them are necessary), there is no reason for them to jam their pipe. They will make more money putting more pipe in the ground instead of effectively utilizing the existing infrastructure.”

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