Quotes

Futures strength, which had largely been responsible for cash quotes rising most of last week, had its supportive ability fail Friday as the physical market took double-digit dives at all points. Cash traders also had to contend with a weekend warm-up in the Midwest eliminating some heating load at the same time that falling temperatures were reducing cooling load in the western end of the South.

Flat quotes for Questar made it the only point failing to bow to weak fundamentals and five straight prior trading days of falling futures Thursday. The rest of the cash market saw price drops ranging from a little less than a nickel to about 55 cents.

Likely in anticipation of much hotter weather in most of the East this week, non-West quotes were only moderately softer in many cases Friday and even included several flat points in the Gulf Coast and Northeast and a small uptick at Iroquois Zone 2.

A flat Waha was the sole exception to continued price increases Friday. Eastern quotes especially saw strong gains as spreading hot weather that promises to stick around for a while raised power generation demand at a time when gas is competitively priced against other fuels. A 61.7-cent screen spike on the day before contributed extra support to the cash market.

Finding support from rising temperatures in several areas and a prior-day spike of more than 40 cents in futures, cash quotes were up across the board Thursday. The screen’s second straight big run-up Thursday, bringing its two-day rise to a little more than a dollar, along with prospects of an extended period of widespread heat starting over the weekend, are likely to propel cash pricing even higher Friday.

Thursday’s 30-cent Nymex run-up proved to have a salutary effect on most eastern cash prices Friday, but overall western quotes continued to soften.

Following two days of mostly higher quotes, the cash market acknowledged the continuing bearish nature of weather, screen and storage factors — supplemented by the extra decline of industrial load associated with a long holiday weekend — by falling from a couple of pennies to around 40 cents at a solid majority of points Friday. Westcoast Station 2 was a special case in plunging about C80 cents.

Weather fundamentals are weakening a bit, but the prospect of much higher prices this winter coupled with a tight supply situation kept quotes on the rise Wednesday at nearly all points. A few flat to lower points kept the gains from extending across the board.

The September aftermarket opened with cash quotes continuing to move higher at a large majority of points Wednesday, but hints were surfacing that this week’s Hurricane Katrina-inspired bull run may have run its course. A modest recovery from massive offshore production outages had begun, and although the near-term Gulf of Mexico (GOM) supply picture remained murky, there were some perceptions that things might not be as bad as they had appeared as recently as Tuesday.