Drops

Global Marine last week reported the first decline in 23 months in its June Summary of Current Offshore Rig Economics (SCORE) for the Gulf of Mexico. The SCORE report measures the profitability of drilling operations. Global Marine Chairman Bob Rose said softening jackup rates due to declining natural gas prices have “taken a toll on the Gulf SCORE.” However, strong oil prices have “continued to fuel improvement in international offshore rig markets.”

To no one’s surprise, softness ruled in Friday’s trading for the weekend. Most price drops ranged from about a nickel to a quarter, with those in the vicinity of a dime most common. The larger declines tended to be at western points, and weekend OFOs caused border-SoCalGas and the PG&E citygate to register plunges on either side of a dollar.

As expected, prices were falling virtually across the board Thursday as the screen turned in another negative performance and air conditioning load remained unseasonably light outside the western portion of the Southeast and in the Midcontinent and desert Southwest.

Global Marine reported the first decline in 23 months in its June Summary of Current Offshore Rig Economics (SCORE) for the Gulf of Mexico. The SCORE report measures the profitability of drilling operations. Global Marine Chairman Bob Rose said softening jackup rates due to declining natural gas prices have “taken a toll on the Gulf SCORE.” However, strong oil prices have “continued to fuel improvement in international offshore rig markets.”

Cash prices at most points outside California and the Rockies dropped a dime or so yesterday in response to light demand, mild temperatures and high storage levels during a relatively quiet trading session. But western points continued to lose ground in chunks, with SoCal-Topock falling into the mid-$5.00s, and Rockies prices fast approaching $2.

California signed another nine long-term power contracts for 900 MW in May and state-wide demand dropped by 11% (3,500 MW) compared to the same month a year earlier, Gov. Gray Davis administration energy officials announced over the weekend in a conference call with reporters. Overall peak demand for electricity dropped 10%, they said.

An attempt to score a quick tax-cut coup has been quietly abandoned by TransCanada PipeLines Ltd., which beat a retreat from a public airing of its political agenda in a potentially lengthy regulatory case. The company said it would hold off action on the case pending the report of a federal-provincial task force which is considering changes in the overall pipeline regulatory regime.

An attempt to score a quick tax-cut coup has been quietly abandoned by TransCanada PipeLines Ltd., which beat a retreat from a public airing of its political agenda in a potentially lengthy regulatory case. The company said it would hold off action on the case pending the report of a federal-provincial task force which is considering changes in the overall pipeline regulatory regime.

This week’s price rally, for which virtually no one could discern any reasonable justification, was over Wednesday everywhere except in California. Most points retreated anywhere from about a dime to a quarter, with greater losses in the Rockies but only small ones in the cooling Pacific Northwest.