Flatness

With a smidgen of flatness mixed in here and there, prices were in rally mode Tuesday at all other points. Traders cautioned against reading too much into the new cash firmness, though, saying it seemed stronger than it was only in comparison to the holiday weekend’s softness. Also, a plunge just shy of 60 cents in natural gas futures Tuesday should turn cash quotes downward again Wednesday, they said.

Except for a smidgen of flatness at two Northwest Pipeline points, prices increased across the board Thursday as freezing temperatures — in some places approaching zero degrees — threatened to spread from the already frigid Midwest into the Northeast and to a limited extent into parts of the South.

Despite indications that severe cold might linger in the Northeast and become more entrenched in the Midwest, prices continued to fall throughout most of the cash market Thursday. But several points — mostly in the Rockies — were flat to up slightly, and Westcoast Station 2 managed a gain of nearly C20 cents despite the pipeline’s imbalance tolerances continuing to encourage maximum drafting.

Despite fundamental support remaining weak for the most part, prices rose at nearly all points Wednesday. A few cases of flat numbers in the West were the exception to gains that ranged from a couple of pennies to around 15 cents. The largest upticks tended to be concentrated in the Midcontinent.

San Juan Basin flatness was the exception to Thursday’s anticipated continuing slide in prices. Otherwise, losses between a nickel and a little over a dime in the Rockies/Pacific Northwest, California and intra-Alberta were fairly moderate in comparison with declines ranging from about a dime to nearly 30 cents elsewhere.

A few flat points, mostly in the Gulf Coast, were conspicuous amid an overall softer market Thursday. Weak weather fundamentals in most areas and the associated lack of electric utility load were responsible for declines ranging from a little under a nickel to a little more than 20 cents, sources said.

Some Midcontinent/Midwest points stayed flat Friday as a cold front was in the process of greatly enlarging its presence in the region, but the rest of the market saw varying degrees of decline ranging from less than a nickel to more than 40 cents.

The mild firming that had marked most trading in the first two days of this week switched to mild softening Wednesday. Temperature fundamentals remain benign in most regions. The screen slipped for the third day in a row, although Wednesday’s dip, like Tuesday’s, was small at only a couple of pennies or so. And traders are expecting another large storage injection report Thursday morning to whack another chunk out of the year-on-year deficit.

With little change in overall weather fundamentals over the weekend, the cash market generally emulated the screen Monday and sat back to await further developments. Most points were about a nickel or less up or down from flat; larger gains and losses were few, scattered and capped at 15-20 cents or so.