Fact

An NGI source who had said Thursday he would not be surprised to see carnage in the cash market Friday was not, in fact, surprised as prices took a dive across the board. The plunges were especially severe in the West, where Northwest’s ongoing constraint limiting Rockies access to southbound transportation (see Daily GPI, Sept. 14) combined with high-linepack OFOs by California’s two big distributors (see Transportation Notes) and the bearish pressures felt by the entire market to produce dollar-plus drops at many points.

The fact that major Wall Street investment companies are forecasting a drastic drop-off in oil and natural gas prices in the second half of the decade, a drop-off that is not reflected in NYMEX futures, could create a stock market buying opportunity, Houston analyst John Olson told GasMart attendees in Denver Wednesday.

LNG boosters were ultimately disheartened at the end of 2005 when the United States couldn’t seem to pull in all of the liquefied natural gas (LNG) it wanted. In fact, last year saw a decline in LNG imports from 2004. However, U.S. markets can look forward to more supply security in the coming years, according to Edinburgh, UK-based Wood Mackenzie.

Although cold fronts or snow were in the Friday forecast for sections of all four main geographic regions of the U.S., the fact that unseasonably moderate conditions had returned to the overall weather picture carried the trading day Thursday and resulted in diving prices across the board. The screen’s prior-day plunge of nearly half a dollar and increasing comfort levels about storage put further downward pressure on cash quotes.

The spike in natural gas futures prices to record levels Thursday can be directly attributed to the fact that major energy markets are experiencing their first real winter storm of the season with sustained cold, according to Sandy “Trot” Goldfarb, one of the largest natural gas local traders.

In a world of “internationalizing” national oil companies (NOCs), the terms “major” and “super major” are quickly losing their meanings.

The fact that the stocks of a number of oil and gas companies lost ground last month can be attributed to the Oct. 31 end of the tax year for many investment entities, but the big question is what will be happening next year, Houston market analyst John Olson said.

The Jonah Gas Gathering System behind the Opal Plant in Wyoming declared force majeure Thursday due to the fact that Wednesday’s scheduled work by operator TEPPCO (see Daily GPI, Oct. 5) incurred unforeseen problems that extended the anticipated downtime of 15 hours. Because of this, Jonah was required to make Cycle III cuts at the Opal Plant for Thursday’s gas day, according to a posting by Sherry Anderson, TEPPCO’s commercial operations manager. Kern River, which derives much of its supply at Opal, said it was informed by TEPPCO that the total cut was approximately 100,000 dekatherms. Kern River encouraged customers with Opal gas to contact their suppliers to see how they might have been affected.

Global Energy Decisions Inc. (GED) said Thursday that high natural gas prices aren’t likely to be leaving anytime soon. In fact, the Boulder, CO-based company, which provides software, consultation and data solutions to the energy industry, said natural gas prices are likely to remain “stubbornly high” for the next few years.