Slide

Except for the still-falling Northeast, Tuesday’s developingmarket plunge came to a complete halt Wednesday and even reverseddirection at several Midcontinent and western points.

Adding to Monday’s 18-cent price slide the futures marketdribbled lower yesterday as traders factored warming temperaturesinto prices and hunted for sell-stops amid two distinct sellingsurges.

The cash market pulled out of its early-2000 slide at leastbriefly with a generally flat to slightly higher price performanceWednesday. However, sources found little but bearish indicators forthe near future.

Despite a leveling off of the general cash market Thursday, inno way did it signify that the recent price slide was coming to anend, sources said. Instead, there was a consensus that weekendnumbers will be performing an ugly swan dive today. Chiefly therewill be the influence of Thursday’s dime-plus screen drop, whichoccurred for the most part after cash business had been completed,several traders said. In addition, quite a few pipelines eitherhave high-linepack OFOs already in place or are expected to issuethem today as storage injection capabilities are highly constrainedon nearly every system. And although it was getting decidedlychillier Thursday in the Midwest and Northeast market areas, theweather still wasn’t cold enough to generate any great amount ofheating load.

Ending a two-day, 24-cent price slide, natural gas futuresclawed higher yesterday as traders covered shorts ahead of theweekly American Gas Association storage report. However, thatbuying interest came to a sudden halt mid-afternoon Wednesday whenthe National Weather Service issued another bearish weather report.Prices quickly tumbled lower into closing bell, trimming profitsfrom more than a nickel to 1.5 cents before settling at $2.657.

Following a two day, 18-cent price slide, the natural gasfutures market held its ground yesterday as traders were reluctantto push very far from center ahead of the release of fresh storagedata. The October contract was held to a tight 7-cent tradingrange, finishing 0.1 cents lower at $2.426.

Aggregation of small retail natural gas customers is still alivein California, but barely. And it’s future is dim in the wake ofnew state legislation (AB 1421) passed earlier this month and nowon the governor’s desk. The legislation restricts unbundling in theretail core gas markets (see Daily GPI, Sept. 13).

Swing prices continued their downhill slide Friday, succumbingto the normal drop in weekend demand, a softer screen and lack offresh storm news. Except for Midwest citygates, where a warmingtrend was developing, virtually all eastern points fell by a dimeor more. Waha and the Permian Basin also experienced dime-plusdeclines, but other western points tended to fall only a nickel orso. Sources attributed the West’s relative firmness to heavy airconditioning and agricultural load in California and other states.

After halting a three-day, 25-cent price slide Tuesday, naturalgas futures slowly began to build yesterday what bulls would liketo think is a base on which further gains will be added. Andalthough it is far from universal, that sentiment was echoed byothers who think that the confluence of relatively strong cashprices and rallying crude oil prices are supportive factors fornatural gas. The April contract finished 3.1 cents higher at $1.748in light trading.