Softness

A diving screen set a softer tone for most points Monday in eastern swing markets. Anticipation of another AGA storage injection report in the vicinity of 100 Bcf contributed to bearish feelings. However, most of the eastern downturns were fairly mild at about 15 cents or less, and much of the West was climbing back up strongly from the price depths seen in Friday’s trading for the weekend.

Virtually all eastern points, along with the Permian Basin/Waha market, yielded to weak weather fundamentals and expectations of another large advance in storage injections by dropping about a dime or slightly more Tuesday. However, a spreading West Coast heat wave kept Rockies/San Juan/Pacific Northwest numbers and those related to the Northern California market strongly on the rise.

Weekend prices were soft as expected, but probably fell less than many traders were anticipating. Except for sizeable losses of 20-30 cents or more in the Rockies/San Juan and at PG&E-related points, nearly all of Friday’s declines were 15 cents or less, and a majority of those were around a nickel.

May aftermarket pricing continued to erode Tuesday nearly across the board. Most declines were between about a nickel and a little more than 20 cents, with a majority of them toward the upper end of that range. The non-Malin California points plunged more than a dollar.

Pockets of firmness in the West went against the grain of overall price declines ranging from about a nickel to 15 cents elsewhere Wednesday. Most of the declines were around a dime.

California softness was the exception to Monday price increases that were in double digits in most cases and continued a general rally that had begun on Friday. Sources attributed the upticks mostly to a further rise in futures, but acknowledged that a widespread warm-up that created some date-specific high temperature records over the weekend was starting to generate some “decent” air conditioning load, particularly in the South and mid-Atlantic.

Triple-digit spikes at the Southern California border andPG&E citygate were the standout leaders of a strongly risingoverall swing market Wednesday. Virtually all non-California pointswere up between about a nickel and a quarter, with the smallestincreases tending to cluster in the Rockies.

Except for California softness, prices managed to edgemoderately higher Monday in the face of light weather-relateddemand and only a modicum of screen support. Unless they werelooking ahead to below normal temperatures forecast next week forthe eastern half of the U.S. by the National Weather Service,sources essentially had nothing concrete to which they could pointin explaining the upticks that continued Friday’s mini-rally.

“We could call it ‘the blizzard that wasn’t,'” jested a marketerin reference to the Nor’easter that had been billed as the firstbig winter storm of the year in the Northeast but turned out to berelatively benign after all. It and other market factors werelosing their price-boosting punch Tuesday, with the result thatnearly all points ranged from flat to about 20 cents lower. Thestandout exception to the general market was a Southern Californiaborder plunge of more than $5.