Most Northeast citygates spiked by half a dollar or more Monday, led by a whopping dollar-plus gain to more than $6 in the Transco Zone 6-New York City pool, as sub-freezing temperatures reigned or approached across the northern tier of states as far west as the Rockies.

Price increases tended to be considerably more subdued elsewhere, however, with most eastern numbers rising between a nickel and a quarter, and the West ranging from slightly higher (San Juan Basin and PG&E citygate) to down about 15 cents in the Rockies.

Sources had mixed feelings about whether the post-holiday surge of bullishness could be maintained, although a majority looked for higher prices again Tuesday. One commented that not only would an arctic cold front be exacerbating frigid conditions in the Northeast, but he also expected Monday’s across-the-board strength in natural gas, crude oil and heating oil futures to provide further momentum for cash.

A Midwest marketer tended to concur, saying, “That $6.50 gas in New York [the peak quote for Transco Zone 6-NYC] is a little frightening. That’s not very good for anyone. We’re lucky to have gotten our deals done early, before there was much screen movement.”

Another Midwest trader wasn’t so sure about Tuesday firmness, though. Saturday and Sunday were very cold in the Chicago area, he said, and temperatures there would remain in the high teens until near the end of this week when a warmup is due. “But even with this weather, though, we’re not seeing any huge demand increase in the Midwest. That’s probably because a lot of people had already locked in most of what they need for December and think they can get by OK on storage.” However, the trader did admit being surprised that based on the forecasts, Chicago citygates didn’t go up by more than about a dime Monday.

A marketer tended to confirm the trader’s suspicion that storage use might effectively cap further increases, saying he was hearing Chicago delivered quotes around $4.17 but didn’t want to pony up more than $4.12. “I figured using storage would get me through OK.”

An Eastern marketer offered his explanation for the price spikes at Northeast citygates: “Very cold weather and a contract that was screaming today. And it kept going up, all the delivered markets were just…driven. Pipeline restrictions on Columbia and Tennessee added to the strength. Those two are big players up there.”

A Gulf Coast source observed that Transco was providing no IT in Tier III (Station 180 near Washington, DC through the East), although 75,000 Dth/d of IT was available at the Linden (NJ) Regulator Station, which is the key bottleneck point for New York City deliveries.

Noting forecasts of potential freezing rain in the Texas Panhandle and parts of Oklahoma, a Midcontinent source said that might add the factor of wellhead freezeoffs to the market picture by midweek.

In contrast to the hubbub about Northeast spikes, a producer said western markets were pretty sedate by comparison and weaker in the Rockies. He looks for cash numbers to largely take their cue from Tuesday’s screen on whether to keep going up, adding, “I gave up long ago on trying to figure out what the screen will do.”

The Weather 2000 consulting firm noted that October and November went down as “very cold months, with December already following their lead.” It went on to say that almost all central and eastern U.S. cities tallied up anywhere from 50% to 150% more heating degree days in November than they did for the same month last year. Weather 2000 expects the current cold pattern to continue through mid-December.

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