Higher

As part of a general rate increase Questar Gas is seeking fromthe Utah Public Service Commission, the company wants to recovercosts of supporting the 2002 Winter Olympics in Salt Lake City.While Questar says the Olympics increase — $500,000 per year forfour years — is only a sliver of the $22.5 million requested,consumer advocates are howling, saying it’s an unauthorized tax tosupport the games.

With new outlets to markets the Canadian natural gas industry ismoving into a new stage with higher prices dictating a change inthe priorities of doing business.

Fueled by a steady stream of short-covering, natural gas futuresambled higher for much of the session yesterday before erupting inthe last 30 minutes amid a frenzy of market-on-close buy orders.That enabled the November contract to push through recent highsabove $3.10 and settle up 8.1 cents at $3.092. Strength was equallyimpressive in the new prompt contract, December, which finished up7.5 cents at $3.223. Estimated volume across all contracts washeavy, with 112,119 positions changing hands.

Feeding off gains notched during the Wednesday evening Accesssession, the futures market climbed higher yesterday as traderscovered shorts positions created during the recent dip. However,after failing to punch through resistance at $2.70 early, theNovember contract slipped in the afternoon before finishing at$2.642, a 4.1-cent advance on the day.

After etching a $2.66 low early yesterday, the futures marketmoved higher on continued speculative buying pressure and bullishconcerns over today’s release of fresh storage data. The Septembercontract finished at $2.708, up 0.8 cents on the day.

Wednesday marked the first time in a week that double-digitmoves were nowhere to be found in the cash market. Most pointsregistered small gains of 2 to 5 cents, feeding off a strongfutures screen and a bullish American Gas Association (AGA) storagereport of a 26 Bcf injection.

The cash market switched gears Tuesday, as gains of 3 to 11cents at most points reversed a two-day trend of general weakness.A strengthening futures screen replaced the slackening powergeneration demand as the main market driver, one trader said, andthe result was increasing gas prices despite moderatingtemperatures throughout the nation.

Fueled by follow-through buying on the heels of Monday advances,the futures market ambled higher yesterday as traders weighed theimpact of bullish news expected to be released this afternoon. TheSeptember contract finished up to 2.3 cents at $2.598. Impressiveadvances were also seen in the out months with the October,November and December contracts notching similar gains.

Following the lead established late Monday, natural gas futurescontinued higher yesterday day as short-term traders bought intothe rally. The August contract closed up 3.2 cents at $2.176,shortly after notching its $2.18 high trade for the day.