Faith

The energy marketplace, investors and credit analysts appeared to have little faith in Dynegy’s ability to turn its deteriorating financial picture around last week. The three credit ratings agencies cut the merchant not once but twice, the stock fell as low as 51 cents a share at one point, and counterparties were apparently ditching the company for safer ground. By Friday, buoyed by rumors that its subsidiary Illinois Power Co. may be close to being sold, optimism was up, albeit slightly, with more buyers than sellers — the price gained as much as 20 cents at midday.

The energy marketplace, investors and credit analysts appear to have little faith in Dynegy Inc.’s ability to turn its deteriorating financial picture around, because Thursday the three credit ratings agencies carved another slice from Dynegy Inc. and its affiliates’ ratings. Standard & Poor’s Rating Services, in concert with Moody’s Investors Service and Fitch Ratings, noted that the energy marketer’s liquidity is quickly disappearing and its ability to bring in cash is weakening.

The energy marketplace, investors and credit analysts appear to have little faith in Dynegy Inc.’s ability to turn its deteriorating financial picture around, because Thursday the three credit ratings agencies carved another slice from Dynegy Inc. and its affiliates’ ratings. Standard & Poor’s Rating Services, in concert with Moody’s Investors Service and Fitch Ratings, noted that the energy marketer’s liquidity is quickly disappearing and its ability to bring in cash is weakening.

Natural gas prices continued to defy gravity Tuesday, as traders added to their long positions in the hope that cold weather outlooks will be validated next week by plummeting mercury readings. The bulls did not have it easy, however, as they were forced to battle back from an early foray into negative territory on the day. Buy stops helped their cause, as prices began to rebound and by noon EST, bulls had notched a fresh one-week high at $2.87. The December contract closed just off that level at $2.852, up 6.1 cents for the session.

“Significant web-based investments directed at residential consumers can only be justified on the basis of faith–not rational financial analysis,” according to a survey by Primen which found virtually no consumers interacting with energy companies on the internet.

Duke Energy late Wednesday confirmed that it has proposed a “good faith” preliminary global settlement designed to help solve California’s ongoing energy crisis and urged Gov. Gray Davis to take a hard look at the initiatives the company has put forward. Key elements of Duke’s proposed settlement include a willingness by the company to build new supply in the state without taxpayers having to foot the bill and resolution of all pending lawsuits and investigations into Duke’s pricing activities.