March prices, which had roared off to a strong start on Monday,filtered lower Tuesday leaving traders wondering if March wouldfollow the weather adage and trade out like a lamb. Cash priceswere slipping anywhere from a couple cents to nearly a dime Tuesdayin most markets. In doing so, many spot points achieved in Marchwhat they were unable to do the entire month of February: tradebelow index. Rockies gas, however, remained in high demand, immuneto the overall losses.
An early Henry Hub trade at 2.24 set the stage for the GulfCoast points Tuesday morning. Subsequent deals traded within twocents of that level, with buyers and sellers matching up well, asource noted. However, he said afternoon softening experienced bythe Nymex could set the stage for the cash market today. “April[Nymex] traded down to the level where cash traded [Tuesday]morning. With that convergence, the ball has been placed in thecash traders court. The question is whether the sellers will beforced to offer the market down into the teens, or will the storagebuyers step up their buying to keep prices in-check.”
Western prices also slippeda few pennies, with El Paso Blancoprices sustaining a six-cent loss to 2.07. For the second day,Rockies prices were able to resist a downturn despite maintenanceon Transwestern Pipeline (see Transportation Notes). Prices theretraded in the 1.94-2.01 area. The only notable exception was apackage of renominated gas on Northwest traded at $1.78. A Coloradomarketer said it definitely wasn’t the 55-degree weather they wereenjoying that was responsible for the strong Rockies prices.Instead, she feels that “nearly everyone” seems to be a littleshort gas in March. “Buyers are coming out in search of only fiveor 10 MMBtus a day but, it’s adding up, and prices are strong as aresult.”
Another source agreed, admitting he is one of those shortRockies gas. However, he looks for prices to come his way once someof the Northwest utilities start to “dump some of their gas back onthe market as the month progresses.”
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