The March futures contract lost 5.3 cents to settle Wednesday at$1.765, thanks to what sources believe was a combination of weaktechnical and fundamental factors. “Today’s drop in the Marchcontract was actually a response to a failure at the 18-day movingaverage for March of $1.824,” one trader said, although otherschimed in many people sold ahead of what they thought would be abearish AGA storage report. Sure enough, the actual report came inat 78 Bcf of withdrawals, which is “significantly” lower than the102 Bcf of gas withdrawn during the same period last year.
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Many western producers believe the coal bed methane legislationsigned into law last week by the president puts drilling operationsin the Powder River Basin and other basins heavy in coal gas backon track. Not so, said Amoco Production Co., warning thelegislation (S. 2500) doesn’t accomplish what was intended.