At first glance Monday was one of those not-too-often cases inwhich “following the screen” did not apply to the cash market. Butas a Northeastern buyer pointed out, an initially flat futuresshowing allowed many physical-gas markets to post gains of a nickelor so, and by the time the screen got around to diving by about 7cents, it was too late to affect a lot of cash deals. But late cashtrading did reflect the weakness in the Nymex pit, said a producerwho found late Henry Hub and Katy sales down 3-4 cents fromearly-morning levels.

Heat played a fundamental role in Monday’s rising prices. It’sgotten hot enough now on the East Coast to stimulate significantair conditioning load, the above buyer said. Such utilities asVirginia Power expected to set summer peak demand records thisweek. In fact, Virginia Power said, it might even surpass itsall-time peak of 14,910 MWh set in February 1996.

And Western prices, which defied last week’s overall softeningas they were driven by cooling demand, continued to outpace therest of the market Monday for the same reason. Quotes for theRockies, Southern California border and PG&E citygate saw theday’s biggest increases in the neighborhood of a dime in somecases. It wasn’t hard to figure out why when you looked atforecasts of approximate 100-degree high temperatures for Denverand Salt Lake City and realized they would get even hotter thanHouston, one source said. And El Paso’s weekend cancellation of anOFO (see Transportation Notes) failed to dampen San Juan Basinnumbers, which rose to the mid $2.00s.

Scheduled maintenance on a compressor at the Opal (WY) gas plantwill take 60 MMcf/d of Rockies supply off the market for todayonly, operator Williams Field Services said.

Although the Nymex drop could carry over into the cash markettoday, it’s likely to be balanced by unsated air conditioning load,one source said. However, a cold front expected to be moving intothe Upper Plains may bring some Midwestern heat relief, which mayexplain why Midcontinent price gains Monday tended to benonexistent or modest compared to other regions, he added.

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