Leads

In what was largely believed to be a follow-through from Friday’s erratic screen rise of nearly 16 cents, cash prices saw strong gains Monday that hit double digits at a majority of points and were especially pronounced in the heated West. Eastern upticks tended to range from about a nickel to a little more than 20 cents, while some western points fit within the East’s pattern and others soared by as much as 40-60 cents or more.

Following an announcement that it had unloaded its CMS Viron Energy Services to Chevron Energy Solutions, CMS Energy reported late Wednesday that it had also completed the sale of its CMS Field Services subsidiary to Cantera Natural Gas Inc. On Thursday, the company announced that it has entered into an agreement to sell its Australian Loy Yang plant.

With an upbeat conference call and better-than-expected earnings for the first quarter, Dynegy Inc. swung to a profit for the first time in over a year, and further encouraged investors that it now expects to surpass 2003 guidance. The sector-leading stock soared, with more than 34 million shares exchanging hands, sending Dynegy up 25% to close at $4.70 — its highest level since July 18, 2002, when it closed at $4.50.

Paced by triple-digit advances at Midwest and Northeast citygates and on Dominion in Appalachia and several Midcontinent pipes, nearly the entire cash market put in a strong weekend price performance in Friday’s super-volatile trading. Flat San Juan Basin numbers missed out on the price party, and other western points tended to see most of the smaller gains of less than 30 cents.

Following similar action taken by Moody’s Investors Service earlier in the week, Standard & Poor’s Ratings Services (S&P) said Thursday that it lowered its corporate credit rating on Peoples Energy Corp. to “A-” from “A+” with a current outlook of stable. The agency noted that Chicago-based Peoples Energy has about $946 million in outstanding debt. In addition, S&P lowered the corporate credit rating on Peoples Energy’s Peoples Gas Light & Coke Co. subsidiary to “A-” from “AA-“.

Citing concerns about increased leverage and business risk associated with the company’s diversification strategy, Moody’s Investors Service on Monday downgraded the ratings of Peoples Energy Corp. and the long-term ratings of the securities issued by its utility subsidiaries, Peoples Gas Light and Coke Co. and North Shore Gas Co. The ratings agency added that the rating outlooks are negative. The utilities’ short-term ratings were not under review.

Once again a previous-afternoon screen uprising worked its magic on next-day cash prices. Friday quotes for weekend flow mostly ranged from approximately flat to nearly a quarter higher. A majority of the gains were relatively modest at around a dime or less.

Texas leads the nation in electricity restructuring, overtaking Pennsylvania, according to the latest edition of the Retail Energy Deregulation Index (RED Index), which was released last Monday by the Center for the Advancement of Energy Markets (CAEM). The 2001 index shows that despite California’s well-publicized troubles and the impact of the Enron collapse, the U.S. and Canada continue to make progress on electric restructuring.

The January aftermarket started out strongly relative to end-of-December numbers, but without straying too far from apparent first-of-month index levels. Nearly all of the swing movement ranged from flat to about 20 cents higher, but gains tended to get much bigger at Northeast citygates, topped off by an advance of more than a dollar at the Transco Zone 6-NYC pool.