After beginning last week amid some excitement caused by theadvent of genuine hurricane activity in the Atlantic, the marketwent into the weekend on a generally quiet note Friday. Nearly allGulf Coast and Midcontinent/Midwest points were flat, but Northeastcitygates and California saw small declines and most Rockies pipesfell by 15 or more cents.

Rockies traders, who left for last week’s Colorado Oil & GasAssociation meeting with regional prices still solidly in the$3.10s and $3.20s for the most part, began returning to the officeFriday in a much different market atmosphere. With storageflexibility declining and a cooled-off California market no longerdemanding as much gas for power generation, it was gettingincreasingly difficult to find a home for Rockies supply. Mostquotes slipped into the $2.80s Friday.

However, just as it seemed California had gone through an entireweek with no power problems, the state’s ISO declared a Stage OneElectrical Emergency Friday afternoon and then quickly proceeded toStage Two, saying consumer demand was tracking higher than expectedas a new heat wave began to build across the West. Stage Onerequested voluntary reductions in electricity use. Stage Two askedutilities to cut 500 MW of interruptible customer load.

For a Gulf producer, the weekend market was “pretty muchtracking the Nymex,” which he conceded didn’t really go anywhere(less than a penny higher). The Midwest and Northeast had cooledoff a bit from earlier in the week, and although there was stillwarm weather in the South, “it’s not unusually hot,” he said.Considering nothing of interest was left in the tropical stormdepartment, it all added up to a snoozer of a market, the producerconcluded.

One marketer noted that the Permian-San Juan basis differentialhad widened to slightly more than a dollar over the course of theweek. You just can’t get much San Juan gas out of the basin with ElPaso running essentially full and Rockies gas also competing to getinto the pipe, she said. Meanwhile flat Permian prices were stillgetting a modicum of support from intrastate Texas and Midcontinentcooling load, she added.

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