Those who expected the swing cash market to use Mondayafternoon’s cash run-up and continued futures strength Tuesdaymorning as a springboard were not disappointed. Late-March quoteswere moving higher by double-digit amounts at nearly every point inall market areas, although few increases exceeded 10-12 centsexcept in the Rockies and Northeast.

Other cash traders tended to agree with a marketer’s comment:”It’s all the screen” with fundamentals in short supply. “Eithergoing up or down, that [futures] is what makes the market.”However, a couple of sources conceded there’s a good case to bemade that the cash and futures markets have been feeding off eachother’s strength in recent days.

A fair amount of post-winter cold lingered in the Midwest,driving Chicago and Michigan citygates to either side of $3. Thecold front was pushing southward, bringing some mild chill to theSoutheast, and also eastward toward the Northeast. However, aNortheastern gas buyer scoffed at the weather impact. “It’s gottencolder, but it’s no big deal,” he said. “Besides, it seems like weand nearly everybody else in the region are still comfortably welloff on storage supplies.”

A producer thought western prices might be getting support frompeople with short supply positions since regional weather is mild.A marketer was in general agreement, but wondered if there might besome softening later this week due to California utility OFOs.”Cool weather kept them [OFOs] away last week,” the marketer said.”But now it’s getting warmer again, and PG&E is projectingabove-target linepack Friday.”

As the April bidweek continued to develop slowly, the screen’sstrength wowed just about everybody (“Can you imagine it? Nearlythree-buck gas in a spring shoulder month!” exclaimed one source)but its impact on April pricing tended to divide along geographicallines. A Northeast marketer reported seeing little difference inoffers from Monday to Tuesday. Gulf Coast basis weakened by up to apenny, he said, but it should have weakened even more consideringhow much ground the April futures contract was gaining.

A Gulf Coast trader also thought eastern prices weren’t showingmuch reaction, at least as of early Tuesday afternoon, to futures.”The main story today is a screen almost reaching $3, and the cashmarket is having trouble deciding which way to go.”

But the screen’s pyrotechnics appeared to be havingsignificantly greater impact in the West. A producer who had soldEl Paso-Permian packages at $2.73-74 Monday said he was able to get$2.84 for his gas Tuesday. A marketer also saw western bidweekprices rising about a dime; basis isn’t moving anywhere, he said,but April numbers were rising along with the screen tide.

©Copyright 2000 Intelligence Press Inc. All rights reserved. Thepreceding news report may not be republished or redistributed, inwhole or in part, in any form, without prior written consent ofIntelligence Press, Inc.