Spot prices rebounded a quarter or more from weekend levels at most locations yesterday with many points exceeding bidweek levels in response to the futures increase on Nymex and some heating load in East Texas and California.

Gulf Coast prices closed in on the July contract. After being more than 20 cents behind July on Friday, Henry Hub quotes gained ground to be about 10 cents behind the screen yesterday. “The hub traded at about $3.705 for the weekend, and today it was trading in the mid-$3.90s. I’m not sure why we’re up here today; it’s got to be all technical. It’s warm here in Texas, two or three degrees above normal, but it’s mild in the Northeast and most other places. There’s a lot of gas in the market. We aggregate producer wellheads and there’s plenty around right now,” he said. He noted that ANR and Tennessee are doing maintenance, but most of the pipeline work is routine and was expected.

However, Texas heat continued to make East Texas a premium market, with Katy quotes exceeding prices at Waha and the Henry Hub. One East Texas utility buyer said she came out buying heavily yesterday to serve generation loads, bring gas back into East Texas from Louisiana and across from Waha.

Midcontinent points rose more than 25 cents but still have room to climb in relation to July futures, said one marketer. “We’re still below average basis for the current month,” he said. “Chicago prices followed Nymex up, but nothing blew out.”

Temperatures across most of the nation were relatively mild. The extremes were in Texas and the Pacific Northwest, which is seeing some record lows, particularly in Oregon and Washington. Hot weather also is starting to build back into interior portions of California with temperatures in the northern San Joaquin Valley and the central and southern Sacramento Valley creeping up into lower 90s.

Fairly wide ranges were seen at the California border, where averages were up more than $1 from Friday levels but still more than $2 below bidweek indexes. “We averaged about $9.48 at Topock,” said one marketer. “We had one piece very small go as low as $8.10 early, but it came storming back and traded a lot in the $9.30-$9.50 range and ended at between $9.70 and $10. Balance-of-the-month is trading right at those levels: $9.50-$10. It was hard to justify day prices in the $8.20s when balance-of-the-month was at $9.30. They shouldn’t be trading that far apart.”

In the east-of-California markets, temperatures were mild and utilities were selling their gas and buying cheap power. “The east-of-California markets came off quite a bit from index and aren’t back up yet,” said one utility buyer. “The California border was weak initially this morning before heading up and the basins were weak as well, far below the index but up a bit from Friday. Weather is mild still and production is up. We have a lack of load right now. In Phoenix, power prices are $97/MWh. It’s actually cheaper to buy some off-peak power than run our own units.”

Rockies points were relatively stable in the low $2.80s with a 10-15 cent range most of the morning. It was flat in the San Juan and fairly uneventful. “The Las Vegas markets were a little bit long; they were out selling today and the SoCal markets were buying,” added one trader.

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