Cash markets settled down for the weekend Friday with flat toslightly softer prices prevailing. Most of the declines of 2-4cents were concentrated in the Gulf Coast and Appalachia/Northeast.
Basis between the Midcontinent and Gulf Coast dwindled tovirtually nothing as both regions traded mostly in the mid to high$2.00s. And Rockies gas, which was being quoted more frequently atjust over $2, had closed its spread from the Gulf to barely anickel. A Rockies source had a simple explanation for thecontinuing strength of area prices: “It’s cold here!” Anothertrader affirmed the cold-weather analysis and added that moreRockies gas is staying at home where people are fairly wellbalanced but “afraid of being short.”
Due to the strong Western pricing, Waha gas is not following itsusual market path of being transported east across Texas or northto the Midcontinent, a marketer said. Katy numbers were only about2 cents above those at Waha Friday.
Transco Station 65 was about the only Gulf Coast point besidesthe Houston Ship Channel to remain on the plus side of $2.10. Amarketer said although Transco prices started lower, they weregetting stronger during the day because all the interconnects werefull, “so if you wanted the gas you had to suck it up and buy it atthe Station 65 pooling point.”
It was a pretty quiet market, as it has been for weeks,according to a Northeastern source. “Right now it’s easier to sellsnow to Eskimos than it is to sell gas to LDCs,” he said. Anothertrader in the region agreed that the utilities aren’t buying, butadded, “Luckily they aren’t selling either.” He thinks thedirection of the Northeast market has nothing to do withfundamentals; rather, he said, the softening of the screen and theabundance of supply in the Gulf Coast is fueling this decline.
Interest in doing deals through the end of next week was growingas traders prepared for Houston Energy Expo.
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