The cash market shrugged off Tuesday’s modest weakening toresume an upward climb Wednesday. Yesterday’s gains weren’t aslarge as those on Monday (mostly 5-10 cents compared with 10-20cents, respectively). Also unlike Monday’s trading, there was nogeographical divergence with Western increases being significantlyless than the East’s; the Wednesday upticks were mixed relativelyequally in both areas.
Transco Zone 6 pushed as high as the mid $2.30s in both New YorkCity-area and non-NYC quotes, but non-NYC was averaging about adime less because the lower end of its range was just under $2.20while NYC-area numbers were all in the $2.30s.
Although Henry Hub futures eventually fell back for a daily netgain of less than a penny, several traders agreed that its earlystrength Wednesday, combined with Tuesday’s increase of about 7cents, did lend support to the cash market. In fact, it wasdefinitely more screen influence than weather behind the Westernuprising, one said.
But a Gulf Coast producer thought weather was the biggest factorin her region “because cash stayed up even as the screen came off.It’s the first time this month I’ve seen Gulf Coast cash tradingabove the screen.” Another producer who has been out of the daytrading mode since late February due to pipeline paybacks lamented,”It’s too bad. Prices would be rising when we don’t have any extragas to sell.”
Contrary to the Gulf producer’s report, a Rockies trader saidprices there tended to drop back in late deals.
A Western producer figured it must have beenMidcontinent/Midwest weather demand that had El Paso-Permiantrading at near-parity with the Southern California border in themid $1.70s after they had been more than a nickel apart Tuesday.Permian gas certainly didn’t derive much strength from intrastateload in Texas, which has escaped most of the severe weather to thenorth and east, he said.
Despite forecasts of a repeat performance of the widespreadwinter storm toward the weekend, a marketer suspects that Wednesdayafternoon’s “relatively wimpy” AGA storage report of 69 Bcf inwithdrawals last week will have cash prices softening today. Thatwas below the expectations of 80-100 Bcf he had been hearing, andhe noted that Access futures trading reacted with a falloff afterthe report came out.
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