Between a plunging screen and mild-to-cool weather almosteverywhere outside the southern U.S., it hardly came as a shock totraders that Tuesday’s swing deals done for today only would failto measure up to September index levels. However, some consideredthe ability of crude oil futures to stay above $22/bbl and eventack on an extra dime a mitigating factor in keeping the initialaftermarket softness fairly mild.
Most of the falls below index were on either side of a nickel,but there was little consistency among market regions. The nickelor more gaps tended to cluster more towards the East, but thatmarket also included flat showings such as the Houston Ship Channelaround $2.90-91. Similarly, San Juan Basin in the low $2.60s andthe Southern California border in the low $2.90s also were flat toindex while nearby Rockies pipes CIG and Kern River fell just overa nickel short of index. Influenced by futures, some points droppedalmost a dime during the course of the morning’s trading.
A large aggregator called the screen meltdown a case of “holidayblues.” Several other sources agreed with him that most of theincremental softness occurred Tuesday and that prices are likely tosee little movement until some further decline for the Labor Dayweekend, then begin a recovery next week. Remember, the peak ofhurricane season has just arrived, a substantial storage deficitremains, and worries about winter supply deliverability are growingrather than abating, a Texas marketer noted.
Tuesday’s volume of swing trading varied widely. Some tradershad nothing at all to report, calling the 1st-only “a dead market,”while others were about as busy as on any typical mid-month day.
For what it’s worth, a Calgary marketer said it was “on theverge of snowing” and that the leaves had already turned there.
Bidweek came to a quiet close with little change from Monday’sweaker price levels. The plunging screen was a negative influencebut came after nearly all of September business had been completed.A buyer said he picked up his last Southern California borderpackage Tuesday morning at $2.88, virtually at the bottom of thebidweek range.
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