Following

Following a three-day, 25-cent price spike, the natural gasmarket cooled its heels Thursday as traders took profits amidtechnically overbought conditions and ahead of the weekend. After alate morning push failed to surpass Wednesday’s $2.78 high, sellerscame out of the woodwork to deliver the March contract a dime lowerto $2.659.

Southwest Gas Corp. has sued Oneok, Inc. and Southern Union Co.following what it called “Oneok’s unjustified attempt to cancel themerger agreement between it and Southwest Gas.”

The swing trading pattern immediately following Christmas didn’tseem very much different from the days preceding the holiday: agenerally softer market, with declines of up to a dime Monday atmost points, arrayed against conspicuously higher prices fordeliveries into the New York City area. One thing that did change,however, was generally flat numbers for the Rockies and California,markets that had participated in the overall weakness last week.

Following a three-day, 30-cent price rally, the natural gasmarket cooled its heels yesterday as traders took profits amidtechnically oversold conditions and ahead of fresh storage data.That sell-off sent the January contract tumbling 9.9 cents lowerthroughout the session yesterday. By virtue of trading above, thenbelow Tuesday’s range it completed an outside-down day on the dailycharts to settle at $2.486.

After a lengthy absence, “following the screen” was back invogue Friday among trader explanations for cash market movement.”How else are you going to justify rising Northeast prices for whatis normally a lower-demand weekend period?” asked a largeaggregator. A stormy front was moving beyond the East Coast intothe Atlantic, but the temperatures it left behind were still on themild side for December, he observed.

Propelled by a technical boost following Monday’s 23-centdecline, the natural gas futures market rallied during the firsthour of trading Tuesday as traders took profits on newlyestablished short positions. But after peaking at $2.31 momentsafter 11 A.M. EST, the December contract once again fell victim tothe same negative weather pattern that has weighed on prices theentire month. That downward momentum quickly took back the earlieradvances, depositing December to $2.189, down 0.8 cents for theday.

Technical factors can, and often do, send prices hurling in adirection contradictory to what underlying supply and demanddictate. While this confounds dyed-in-the-wool fundamentalists anddelights technicians, it can also backfire. Yesterday was one ofthose days.

Following Monday’s 7.5% price retracement, the natural gasfutures market continued lower yesterday as short and long-termtraders added to newly established short positions. Cash prices,pressured lower for the second day in a row by record-setting hightemperatures, were also seen as a negative price factor. Afteropening at $2.64, the December contract quickly established a new4-month low at $2.59 before settling at $2.643, a 2.2-cent declinefor the day.

Following the Tortoise and the Hare maxim that slow and steadyoften wins the race, the Kansas Corporation Commission (KCC) hasdecided to approach retail competition at a turtle’s pace. The KCClast week tossed out the idea of installing statewide customerchoice and instead chose to leave open the possibility that MidwestEnergy, one of the state’s many LDCs, can, if it chooses, file anapplication for a small retail pilot program.