Prices continued to build Monday on the strong foundationdeveloped in the latter half of last week. Only the NorthernCalifornia points of Malin and the PG&E citygate failed to gaina dime or more.

A firming September gas futures contract and warmer weather inthe Midwest and Northeast gave some support to the cash market. Butit was the first burst of Atlantic storm activity following anuneventful first two months of the hurricane season that providedmost of the impetus for price advances, sources said.

As expected, the Atlantic’s first named tropical storm of theseason strengthened into Hurricane Alberto over the weekend.However, it was still more than 1,000 miles east of the LeewardIslands (the northern end of the chain between Puerto Rico andVenezuela) Monday, so any potential Alberto threat in the Gulf ofMexico is unlikely to occur before next weekend at the earliest.

Closer to home, however, was a tropical wave in the vicinity ofMexico’s Yucutan Peninsula. It was moving over land Monday,according to the National Weather Service, “but has some potentialfor development as it moves west-northwestward into the southwestGulf of Mexico in a day or two.”

Gas buyers weren’t particularly thrilled over what theyconsidered more “storm hype” increases in prices. “Being 60 centsover index this early in the month isn’t very appealing at all,”said a Midwestern trader who paid in the mid $4.50s for a MichConpackage. MichCon seems to be considerably shorter on supply thanConsumers and thus priced higher, he said (NGI recorded about adime spread between the two Michigan citygates Monday).

Some people were just looking for any reason they could find topush prices higher, a Texas producer said, and the storm news camein handy for that purpose.

It was a “wild ride” in the warming Northeast, as one marketerdescribed it. She felt fortunate to have bought gas early on eitherside of $4.70 in Transco’s Zone 6-NYC pool because she was able tosell later at $5.00. Timing was crucial Monday. “It was good to buyearly and sell in the middle [when prices got as high as the$5.20s], but you didn’t want to hold your gas till the very end”when numbers dropped back to around $4.80.

The intra-Alberta market was almost non-existent because of aprovincial holiday. One trader reported seeing a C$4.56 average onan electronic trading service for about 48 deals, “but that’s amuch lower volume than usual.” In addition, the Rockies market willbe “almost totally dead” this week because of many tradersattending the annual meeting of the Colorado Oil and GasAssociation, he added.

©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.