Quotes for Transco Zone 6-New York City deliveries soared as high as $7.50 Monday as Northeast electric utilities struggled to cope with high temperatures that generated heat advisories throughout much of the area. The heat sparked the PJM Interconnection grid operator to issue a plea for emergency supplies and sparked a run-up in Nepool (New England) and PJM-West power prices for Tuesday to averages of about $116/MWh in each pool, according to the IntercontinentalExchange trading platform. New York and PJM websites showed hourly prices spiking occasionally up to the $1,000/MWh price cap.

Most of the rest of the gas market also was firmer, although no other points were close to seeing the New York City price fireworks. Neighboring Northeast citygates were strong and approached $4 in late deals at Iroquois Zone 2 and the Algonquin citygate. Otherwise most of Monday’s gains were between 10 and 20 cents, although some western points were barely above flat and moderate declines of up to about 20 cents were seen in the Rockies, Pacific Northwest and Western Canada markets.

In an appeal for public conservation, the New York Independent System Operator said it anticipates an all-time record demand for power in the state Tuesday (see story in Power Market Today).

Zone 6-NYC started around the $4 level and traded mostly between there and $5 until a scramble erupted near deadline for fast-disappearing supplies and pushed late purchases above $6 and $7, one source noted. Prices started moving in half-dollar increments once numbers got above $6, he said.

“It’s good to have flexibility. We’re selling our injection gas instead of putting it into storage,” said one Northeast utility trader, who noted that there would be plenty of opportunity later to stock up on storage when prices fall again. He said rains could ease the heat situation a bit by Wednesday, but generally the region will have to endure until the end of the week before experiencing significant relief.

“We’ve got a little heat here in the Midcontinent/Midwest, but obviously it’s not as bad as over on the East Coast,” a marketer observed. His Chicago citygates were up only about a dime into the high $2.90s.

A Florida utility buyer said he and others were caught off guard when Florida Gas Transmission, after lifting a market-area Overage Alert Day notice Friday, put it back into effect over the weekend (see Transportation Notes). “I was selling at the citygate all last week, but today [Monday] I used all my transport” to move gas from the production area, he added.

Obviously being boosted by their high market-area demand, Transco Station 65 and FGT Zone 3 easily led Gulf Coast numbers with increases of more than 20 cents to $3.25 and $3.20 respectively. However, an ongoing construction bottleneck at Transco Station 35 continued to cause heavy discounting of prices at the pipeline’s Station 30 pooling point, which trailed other South Texas pipes by 20 cents or more Monday. A Transco spokeswoman said last week that the Station 35 work is due for completion by the end of this week (see Daily GPI, July 23).

For one trader in the Pacific Northwest/Western Canada markets, bidweek seemed “almost non-existent so far, even with the Nymex settlement wrapped up today.” But a Midcontinent/Midwest marketer said his company was almost finished with August business Monday afternoon, leaving just a few more deals to complete Tuesday. August prices were “moving up a little” Monday from the levels of late last week, he added.

A Northeast trader said it “seemed kind of silly” to be buying swing gas Monday at Texas Eastern M-3 for as much as 70 cents over Henry Hub when August physical basis for M-3 is only plus 32 cents. But he conceded, “Of course, if you have to have the gas immediately, you can’t hold out for next month.”

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