Almost as fast as they had gone up Tuesday, cash prices headedback down Wednesday. In one of the quickest hit-and-run operationsever mounted on Gulf of Mexico production, Earl achieved hurricanestatus but was already leaving offshore platforms behind afterveering sharply eastward overnight. While the storm appeared to beheaded into Florida’s Panhandle, workers were returning toplatforms off Louisiana and Texas and the estimated 8 Bcf/d ofshut-in gas gradually started to flow again.

There still were significant curtailments yesterday afternoon,however. Columbia Gulf reported 675 MMcf/d of gas was not enteringits system, but by mid-afternoon work crews were returning to itscompressor platform. ANR reported 600 MMcf/d still was curtailed atEugene Island and 482 MMcf/d was shut in at HIOS. Stingray wasn’tgathering any production, leaving 1.2 Bcf/d off the market.Tennessee’s Bluewater system was lacking about 750 MMcf/d andTransco was down 1.9 Bcf/d. Sonat reported 250 MMcf/d incurtailments, and Sea Robin was still down about 100 MMcf/d. Tetcoreported shut-ins of 900 MMcf/d and said the Terrebonne system waswithout 1.1 Bcf/d of production.

One big producer said his western Gulf production was comingback on-line, “but the Louisiana stuff is still kind of spotty.” Amarketer said it seemed reasonable to expect that storm shut-inswould be down to zero by Friday. However, another trader said shewas “still chasing gas” late Wednesday. By late afternoon, mostpipelines said near normal operations were expected to be reachedby mid-day today.

Most price points reacted accordingly, falling by a dime or moreWednesday. The ones with losses in single digits tended to be inthe West.

Those who had predicted that the market impact of Earl would beminor and short-lived may justifiably sport an “I told you so”attitude, one source said. Although a sizable amount of offshoresupply was still off the market Wednesday, the price spikes lastedonly a day because it was obvious to traders early that the stormthreat was already nearly gone, he said. He figures a lot of peoplewere pulling from storage to sell during the outages becausethey’re confident of getting cheaper refill gas.

Though they weren’t subject to the Gulf Coast’s supplydeprivations, Western prices were falling almost as hard as thosein the East. Weather remained hot in the region Wednesday but isexpected to cool off a bit in the next couple of days. TropicalStorm Isis, off the Mexican coast in the Gulf of California, ispredicted to move northward and bring rain to the Southwest by theweekend.

A lot of Midcontinent gas was going into the Permian Basinbecause it couldn’t find any decent markets in the Midwest, amarketer told Daily GPI. Permian/Waha prices in the high $1.60swere only 3-4 cents under Chicago citygates and virtually even withdeliveries in Michigan.

Indicating how weak the California price outlook is, a marketerreported being offered border gas for the rest of September at$1.965, about a nickel under index and more than 20 cents belowWednesday’s incremental levels.

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