Plunges

Except for plunges in the Rockies, the market ended the week on a considerably stronger price note Friday than some had been expecting. A few Midcontinent pipes (Williams, NGPL-Midcontinent and Reliant-West) were close to either side of flat, but gains at other non-Rockies points ranged from a little less than a dime to more than a dollar (Algonquin citygate). A majority of the upticks were between a dime and a quarter, with much larger ones clustered in Northeast citygates.

Plunges of about a dollar in the Northeast and about half a dollar on Dominion in Appalachia far outran moderate softness in the rest of the market Friday. The February aftermarket started with losses elsewhere that tended to range from about a nickel to a quarter, and the Rockies even registered some small gains.

Despite expectations of continued softness following Tuesday’s all-around price plunges, most points found themselves in rally mode Wednesday. With a few scattered small drops thrown into the mix, the majority of the cash market ranged from flat to up nearly 40 cents, with gains in the teens being most common. Tennessee Zone 6 was a standout with an uptick of more than 80 cents.

Plunges in New England citygates and mild firmness in the Rockies constituted the extremes in an overall market Tuesday that saw most points range from flat to down about 20 cents. A solid majority of the declines were small at less than a dime.

Cash prices emerged from the weekend in a general softening trend Monday, but with some flat to higher numbers in the West mixed in and a sense among a couple of sources that the market is still relatively strong. Northeast citygates plunged while the rest of the East mostly fell between a couple of cents and about 15 cents.

PG&E Corp.’s stock price plunged nearly 30% last Thursday to $9.76 and dropped 10% more Friday to end the week at $8.81, following a downgrade of its National Energy Group (NEG) merchant and trading subsidiary to junk by Standard & Poor’s. The downgrade set off ratings triggers in $1.6 billion of NEG obligations.

The slippery downhill slope on which prices were launched Wednesday, somewhat befittingly during the Winter Olympics in Salt Lake City, got steeper Thursday, especially for Northeast citygates. Most points saw drops ranging from about a nickel to a little more than a dime, with those on either side of a dime being most prevalent. But numbers in the warming Northeast dove by as much as 49 cents.

It was an easy call to predict lower prices for the low-demand Memorial Day weekend, so nobody got caught by surprise Friday when an across-the-board dive swept the market. No point fell less than 20 cents, and western declines tended to be significantly larger than that.

Pacific Gas & Electric finally brings an extended Stage 3 high-inventory OFO to a halt today. The OFO, which caused steep plunges at PG&E-related pricing points Friday when it was issued for Saturday, got extended through Sunday at zero tolerance for positive daily imbalances. The tolerance was loosened considerably to 15% in Monday’s OFO, but $5/Dth penalties remained in place.