As expected, the cash market responded to what was considered amildly bearish storage report with mostly mild declines Thursday.Eastern points generally fell in the vicinity of a nickel exceptfor some Northeast citygate drops around a dime, while the Westranged from flat to down as much as a quarter (Stanfield).

Firmer futures and hot weather throughout much of the nationweren’t enough to avert the cash softness, sources said, and any”storm hype” support was long gone. The Atlantic continued to beroiled with storms of various types but nothing appeared likely toaffect Gulf of Mexico production.

Although the Consuming Region West has registered smallwithdrawals in the last two AGA storage reports, ironically it’s anexcess of storage that is weighing down on Rockies and Canadianprices, one trader noted. Northwest has clamped down oninterruptible injections because its Jackson Prairie facility isnearly full (see Transportation Notes). And it was very much aroller-coaster ride in the intra-Alberta market Thursday as lack ofstorage injection flexibility tended to depress prices, a Calgarymarketer said. His numbers started at C$4.07, fell to C$3.90,rebounded to C$4.18 and then returned close to their starting pointat C$4.09. It was the first time in a long while for Rockies pipesto dip below $3 and intra-Alberta to experience sub-C$4 quotes,both sources said.

Despite severe heat in the South, the fuel buyer for oneregional electric utility said he wasn’t buying as much gas asusual. That was partially due to having all his solid-fuel unitscranked up and having baseloaded a lot of gas for August, he said,”but the main reason is that I’m shying away from gas prices thatare still 50-60 cents above first-of-month indexes.”

Malin has been holding up more strongly than most western pointsrecently but took a pretty hard fall toward the end of Thursday’strading, a large aggregator said. Malin saw a range of more than 50cents and wound up averaging slightly under $4. It’s hard to figureout, the aggregator said. “Earlier in the day people were asking ifI had any extra Malin [gas]. Then all of a sudden people startedcalling trying to sell me Malin, and I hadn’t seen that” earlierthis week.

Sources have noted recently that East Coast fuel oil prices arebeating natural gas handily at the burnertip, but that may not lastlong if the current trend in crude oil futures continues. Aftersoaring more than a dollar Wednesday, the September crude contractfell barely shy of tacking on another dollar Thursday as itsurpassed $31/bbl.

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