Downward

Mired in a bog of bearish influences, cash prices continued to drift downward Wednesday at nearly all non-California points. Much like the day before, most of the downturn ranged between about a nickel and a dime, but with larger drops in the teens recorded at several Northeast citygates.

ONEOK revised downward its earnings guidance for 2001. It said net income excluding the effect of an Oklahoma Corporation Commission (OCC) charge is estimated to be about $1.20 per diluted share of common stock, which compares to Wall Street estimates between $1.35 and $1.50. Net income is estimated to be only $1.02 per diluted share of common stock including the impact of the OCC charge. The company earned $1.10 per diluted share in 2000 excluding the sale of a processing plant.

ONEOK revised downward its earnings guidance for 2001. It said net income excluding the effect of an Oklahoma Corporation Commission (OCC) charge is estimated to be about $1.20 per diluted share of common stock, which compares to Wall Street estimates between $1.35 and $1.50. Net income is estimated to be only $1.02 per diluted share of common stock including the impact of the OCC charge. The company earned $1.10 per diluted share in 2000 excluding the sale of a processing plant.

With little to no change in fundamental conditions and energy futures continuing to point downward, the cash market saw no reason to vary Wednesday from Tuesday’s precedent of mostly moderate declines. General price movement was more homogenized across regions yesterday, as drops of about a nickel to 20 cents or so characterized the softening for all but a few points.

Last week, Enron Corp. saw things go from bad to worse, with its stock price continuing to plummet, a formal probe launched by the U.S. Securities and Exchange Commission, downgrades by credit ratings agencies and energy analysts, and finally, a letter to the board from one of its largest shareholder groups urging the energy trader to begin making reforms in its practices to restore some investor confidence.

Just when it seemed the cash market was locked into an endless downward spiral, it found a plateau on which to level off Thursday. Flatness was the order of the day for most points, while others were mildly higher or lower. Spot points in California and the Pacific Northwest/Western Canada softened by about a nickel or a little more.

As Enron Corp.’s stock continued on a downward spiral yesterday in the wake of President and CEO Jeff Skilling’s announced resignation late Tuesday, Wall Street analysts moved quickly to reduce their long-term price targets for the energy giant’s stock and downgrade their ratings (see Daily GPI, Aug. 15).

Dropping beneath $4.00 for the first time since early August, natural gas futures continued on the slippery slope downward Friday as traders pressured the market lower for the third straight day. With Friday’s 8.1-cent decline and $3.973 close, the June contract has tumbled 96.7 cents since becoming spot contract at Nymex a month ago. June expires at 3:10 p.m. (EDT) today.

Despite turning downward again Friday, the screen’s uptick of nearly 15 cents the day before had a residual supportive effect for Friday’s cash prices in eastern and Permian/Waha markets. They ranged from flat at a couple of Northeast points to 15 cents or so higher (Gulf South was a rare softer point in Louisiana), with most gains between a nickel and a dime. Most western points declined by various amounts ranging from small to huge.