Skyrocket

Demand for natural gas to fuel new power plants in Ontario will skyrocket if the province makes good on its plan to phase out four coal-fired generating plants by 2014, a CIBC Markets analyst wrote in a recent research note.

Prices soared at virtually all points Monday after a frigid mass of air from Canada had invaded much of the U.S. and sent temperatures plunging, even in the previously mild South. Some Northeast citygates led the price climb with gains around a dollar or more, and most other points rose by at least half a dollar.

Prices soared at virtually all points Monday after a frigid mass of air from Canada had invaded much of the U.S. and sent temperatures plunging, even in the previously mild South. Some Northeast citygates led the price climb with gains around a dollar or more, and most other points rose by at least half a dollar.

Swing prices exploded Monday in hyper-volatile trading featuring across-the-board multi-dollar gains, with Northeast quotes soaring to peaks of more than $30 in some cases and most Gulf Coast/Midcontinent/Midwest numbers averaging between $10 and $20. The spikes weren’t quite as spectacular in the West, but still impressive as the Rockies market soared to $6-8, Malin peaked at more than $10 and El Paso-Permian was quoted as high as $15.95.

The big rallies that had developed late in Friday’s trading for the weekend provided a solid base for spectacular price increases Monday. Gains of about 30 cents or more were common in the East, while the West, where winter storm watches were posted for parts of the Pacific Northwest and northern Rockies, registered upticks that exceeded 40 cents in most cases.

It was off to the races Tuesday for spot prices, as a soaring screen paced the cash market to large gains. Except for the Rockies and Southern California border, nearly all other points managed to surpass the November futures advance of a little more than 21 cents. The run-ups were attributed largely to a noted meteorologist’s forecast that the coming winter will rank among the top third of the coldest over the last 106 years (see related story).

The cash market was doing a skyrocket imitation Monday amidsignificant fundamental influences, along with a large dose ofsupport from both natural gas and oil futures. Only a fewRockies/Pacific Northwest and Western Canada points failed to riseby about 20 cents or more (MRT and ANR ML-7 were among theexceptions elsewhere).

Drilling has picked up to a frenzied pace as active natural gasrig numbers continue to skyrocket in the United States and Canada.Rotary rigs drilling int he United States soared by 20 last week toa new record of 736 active gas drilling rigs, according to BakerHughes’ Rig Count report. Currently there are 235 more domesticrigs actively drilling than at the same time last year.

Drilling has picked up to a frenzied pace as active natural gasrig numbers continue to skyrocket in the United States and Canada.Rotary rigs drilling int he United States soared by 20 last week toa new record of 736 active gas drilling rigs, according to BakerHughes’ Rig Count report. Currently there are 235 more domesticrigs actively drilling than at the same time last year.