Cold

Two wrongs do not make a right, but they do make for somevolatility in the natural gas pit. Since December’s precipitousclimb to $6.32 last week, the prompt month has vacillated wildly— first lower and then higher, prompting traders to suggest thosemoves were a little bit overdone. However, last Wednesday’s movehigher received some validation Friday when prices bounced offsupport and erupted higher to once again close in the $6-plus pricestratosphere. After trading within a wide, half-dollar tradingrange, the December contract finished the week strongly, up 30.2cents at $6.10.

Oklahoma Attorney General Drew Edmondson has asked the stateSenate to postpone the July 2002 deadline for deregulatingOklahoma’s electricity market in light of power market problems andhigh prices in deregulated states such as California, New York andMontana.

It doesn’t matter whether forecasters’ predictions of an earlycold winter materialize or not. Under any short-termweather/storage scenario, Salomon Smith Barney (SSB) continues tobe very bullish on the outlook for natural gas prices.

It doesn’t matter whether forecasters predictions of an earlycold winter materialize or not. Under any short-termweather/storage scenario, Salomon Smith Barney (SSB) continues tobe very bullish on the outlook for natural gas prices.

Even with much of its cold weather support disappearing, thecash market still found cause for moderate bullishness Wednesday.But that’s expected to pale in comparison to the fireworks thatsources were predicting for today after the screen exploded withgains of more than 35 cents in both the November and Decembercontracts following AGA’s below-expectations storage report.

Pacific Gas & Electric lifted a high-inventory OFO that hadbeen in effect for Friday only. All cold weather-related pipelineOFOs issued in the last two weeks remained in effect going into theweekend.

Citing cold weather and operational conditions, MRT issued anOFO Wednesday. All IT and AOR (Authorized Overrun) volumes flowingnorth of the Glendale (AR) Station on the Main Line wereinterrupted. Affected customers should re-source their Main Linesupplies to the East Line or take their Main Line IT and/or AORreceipts to zero, MRT said.

MRT lifted Wednesday an OFO affecting interruptible gas north ofthe Glendale, AR, Station (see Daily GPI,Jan. 5).

MRT issued an OFO Tuesday due to anticipated cold weather andoperational conditions; the order will remain in effect today anduntil further notice. It is interrupting all IT volumes andAuthorized Overrun gas flowing on the mainline north of theGlendale, AR, Station. MRT will not allow underdelivery of gasduring this time but will continue to accept positive imbalancenominations.