A great majority of the cash market ranged from flat to nearly 20 cents higher Monday as traders watched a skyrocketing screen and heard a great deal of talk about nuclear plant outages. But CIG, Cheyenne Hub and Questar led Rockies/San Juan Basin declines sparked largely by a major one-day constraint on Rockies gas moving eastward and also by light weather load.

In addition to strong futures, eastern markets got support from both heating and cooling demand. A couple of Northeast traders agreed that area temperatures are chilly enough to keep quite a few furnaces burning. “It was 36 degrees when I got up this morning,” said a New England utility buyer. “I had to turn the heat on. We keep getting hints of spring, but then it keeps going back to a winter/spring mix.” A TV weatherman said it’s 10 degrees cooler than normal, she added.

Another utility buyer in the lower Northeast said gas prices were feeling the effects of nuke outages, “but we’re also still getting some cooler weather. It doesn’t usually last this late into the spring.” Their sendout was evidence that furnaces were still in use, “but nothing major,” he said.

The Northeast didn’t have a monopoly on unseasonable cold. “It’s been snowing all weekend and still going today” in Calgary, a producer said. Apparently winter hasn’t heard that spring has arrived, she added. The producer was trading intra-Alberta gas for June and said prices there were rising steadily Monday from the mid C$6.30s to the low C$6.50s, and in late afternoon the bid-ask spread was a hefty $6.40-65. People were asking each other why next-month numbers are so strong, she said, and the best guesses were that storage and nuke outages are the main issue.

For a Midcontinent/Midwest marketer, a “screen going crazy” was the key factor in the eastern bullishness. It’s “cool up here [Midwest] with highs in the 60s, but there’s not really that much heating load,” he said. Cash got most of its increase from following gas futures on its way to an eventual daily gain of nearly 45 cents, he said, and should keep going up Tuesday due to the residual effect. The market was “really quiet for a Monday” with a lot of indexing going on due to a number of traders being out of their offices at the GasMart/Power 2003 trade fair in New Orleans. Activity should pick up again around midweek as GasMart ends, he said.

Crude oil and heating oil futures joined the gas contract in recording major gains.

Discussion of the nuclear situation was common in the trading community. For a producer who trades the Gulf Coast and Northeast, plant outages in Florida (Saint Lucie 1) and Texas (South Texas Project 1) helped boost his prices. “Nukes go offline, power generators switch to peak burners, less gas goes into storage, and prices keep going up. So I guess this is a supply issue, even if that [analysis] is a little overdone.”

But even though spring is a common period for nuclear refueling and maintenance downtime, the current level of outages is impressive to the gas market (see the Nuclear Regulatory Commission’s list of units that are operating at less than 100% or have returned to 100% since the previous day at NGI’s web site: https://intelligencepress.com/subscribers/power/nrc/).

In the South, heat and humidity are contributing to gas demand more than ever. Florida Gas Transmission repeated Monday a warning from last week that hot weather may necessitate an Overage Alert Day notice as early as Tuesday (see Transportation Notes). A marketer reported power generation load staying strong in the intrastate Texas market and supporting Waha numbers in the low $5.00s. However, load is “almost nothing in California,” he said, nothing that border prices ran about 15 cents under Waha levels. But it’s getting quite a bit warmer in Arizona, “and they might start buying more gas soon,” he commented.

Quotes at Rockies points such as CIG and Cheyenne Hub, and to a lesser degree Questar, suffered due to a major constraint on gas moving east. Construction was scheduled for Tuesday’s entire gas day at the Dullknife meter station, Wyoming Interstate Company’s interconnect with Trailblazer. Neither CIG nor WIC will be able to deliver to Trailblazer that day, although normal service is expected to resume Wednesday.

Rockies pipes whose primary market area is to the west didn’t get hurt as bad, a marketer said. “Opal started soft due to disappointing flows over the weekend, but then rebounded and got as high as $4 late,” he said. Another factor in Rockies/San Juan weakness that storage injection rates in the West are slowing down, he said.

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