From a mixed performance the day before, the cash market went to a virtually united show of strength Tuesday. A large majority of the upticks were in double digits, but some — mostly in the Gulf Coast — were less than a dime.

“It was almost entirely a weather thing” driving prices higher, according to a Gulf Coast producer. Prices started strongly, “came down a hair” and then rebounded, he said. There also was the factor that cash continues to be heavily discounted from December futures, so part of Tuesday’s bullishness was related to a convergence attempt, the producer added.

This week’s spate of winter weather is turning out to be significantly more severe than had been anticipated prior to the Thanksgiving holiday. It also is widespread, leaving little other than the southeastern corner of the U.S. unaffected as of Tuesday, but a stormy front expected to leave an icy sheet over much of Texas and the Midcontinent was moving in that direction.

Transco points in the production area registered some of the day’s smallest advances amid reports that the pipe was stuffed to the gills with gas. Indeed, Transco cited operational constraints in declaring that effective today on its Southeast Louisiana Lateral, it is limiting receipts upstream of Station 62 for downstream delivery to 450,000 Dth/d.

A marketer observed that nearly all OFOs or other pipeline constraints are currently on Gulf Coast lines. “I’ve got to believe that Sonat will join others in issuing an OFO soon,” he said, citing Sonat’s huge cumulative positive imbalance for the month (see Transportation Notes). End-of-month cash-outs are about the best price many people can get for their gas lately, which explains the prevalence of Gulf Coast OFOs, the marketer said.

The natural gas screen bore little relationship to cash, as it spent the morning almost a dime down. However, growing rumbles of potential supply disruption in the global oil market spurred crude oil and heating oil futures to strong gains.

Midwest citygates, which on Monday had almost ignored the winter storm bearing down on them, were forced to sit up and take notice Tuesday. The result was gains on either side of 30 cents for delivered gas.

December bidweek activity continued but remained slow for the most part, as traders awaited today’s Nymex settlement. A marketer said he thought the December screen was way too high and “should come down, but I don’t know if it will. There is still a huge spread” between futures and cash.

A western trader reported December fixed-price deals in the mid $2.40s for border-SoCalGas, the $2.10s for Kern River-Opal and the low $2.00s for San Juan-Blanco.

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