Bigtime volatility was the name of the game Friday in the cashmarket. Price changes ranged from more than 20 cents higher at manyLouisiana points to about a nickel lower in Northern California.Ranges often were huge also, exceeding 30 cents in some cases. Anypoint with a high and low separated by less than a dime-well, theyjust weren’t trying hard enough, one source commented.
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Some Points Level Off, But Overall Outlook Still Weak
Most cash points tended to ignore Thursday’s rebound on thefutures screen and instead focused on weak fundamentals. Many GulfCoast and Midcontinent pipes were leveling off from Wednesday’sprecipitous plunges, although several in the Gulf fell a few morecents. The losers included points in South and East Texas despite aferocious heat wave straining the state’s electric utilities.
Prices Waste No Time in Shedding Storm Spikes
Almost as fast as they had gone up Tuesday, cash prices headedback down Wednesday. In one of the quickest hit-and-run operationsever mounted on Gulf of Mexico production, Earl achieved hurricanestatus but was already leaving offshore platforms behind afterveering sharply eastward overnight. While the storm appeared to beheaded into Florida’s Panhandle, workers were returning toplatforms off Louisiana and Texas and the estimated 8 Bcf/d ofshut-in gas gradually started to flow again.
Flatness Reigns for Weekend; Chaco Impact Slight
The cash market continued to muddle around with essentially nodirection for a second straight day Friday, leaving weekend numbersmostly unchanged. The few drops of about a nickel occurred atWestern points-intra-Alberta, Stanfield, Malin and SouthernCalifornia border-and chiefly resulted from the lifting of supplyand/or transportation constraints that allowed more gas back intothe market.
Cash Prices Hot in West But Cool in East
Hot weather appeared to be the primary driver of gas pricesMonday. When you’ve got it, as regions from the Rockies westwarddid, quotes went up by about a nickel at many points; when youdon’t have it, as the relatively balmy Midwest and Northeast marketareas didn’t, prices were flat to down as much as 7 cents.
Declines Mild Except in Northeast and Southwest
The usual slump in weekend demand and moderating weather hadcash prices softening Friday, but for the most part losses weresurprisingly small considering how weak the market had seemed inthe face of record-setting heat waves earlier in the week. The onlyreally big declines hitting double digits occurred at opposite endsof the U.S.: Transco Zone 6 citygates in the Northeast, andCalifornia and San Juan Basin numbers in the Southwest.
Down Again: ‘Seems Like Buying Frenzy Is Over’
Another day, another dime (or so) down for cash prices.Acknowledging it was a colossal understatement, a marketercommented, “It seems like the buying frenzy is over.” Although airconditioning was still generating its fair share of demandWednesday, it wasn’t nearly enough to prevent more slides on eitherside of a dime at nearly all price points.
Prices Hit Plateau; Big Midcontinent Plant Blast
With little to go on in the way of guidance, cash prices muddledaround in an essentially flat performance. There were scattered upsand downs, but no point moved by more than a nickel in eitherdirection and most changes were minuscule.
New Softness Erodes Expectations of Price Rally
The cash market lost some ground Tuesday, again defying sources’pre-holiday expectations of a rebound from last Thursday’s pricerout. Except for PG&E citygates and intra-Alberta-each upalmost a nickel into the high $2.20s and low C$2.00srespectively-and small gains at a couple of other scattered points,quotes registered as flat to down 5-7 cents.
Sources Expect Price Erosion Will Continue
Cash prices were dropping for the most part Wednesday as manyhad expected, and there’s no reason not to expect more softeningthrough the rest of the week, several sources said. They had plentyof evidence to back up their prediction: forecasts of moderatingheat in the South by the weekend, a falling futures screen and abearish AGA storage report exceeding 100 Bcf in injections.