Surprise

More than one trader got fooled trying to predict Thursday’s market. Sources had been near consensus Wednesday in expecting that day’s price slide to continue. Instead, cash quotes managed a fairly strong rally, rising between about a dime and a quarter nearly across the board. Only a nickel loss at the Algonquin citygate ran against the overall market grain.

Coming as no surprise Thursday, Aquila Inc., which shut down its marketing and trading business earlier this week (see Daily GPI, Aug. 7), reported a loss of $5.69 per share for the second quarter, compared to earnings per share of $1.21 in the second quarter of 2001. The troubled Kansas City-based company took its lumps on its Quanta Services investment, company restructuring and lower commodity trading volumes and prices.

In a surprise announcement last Wednesday, UtiliCorp United said it plans to buy back the 20% of its trading and risk management arm, Aquila Inc., that it sold to the public earlier this year and adopt Aquila as its corporate name. The move comes as a strategic reversal apparently prompted by the weakening economy and industry changes. Executives dodged questions as to whether the move was spurred by the financial troubles at the energy industry’s largest trading house, Enron Corp.

There was no surprise when prices continued to fall Friday, but what many didn’t expect was eastern quotes holding up as relatively strongly as they did. Nearly all points in the East fell by about a dime or less, and a few scattered ones eked out small gains. Meanwhile, the West fulfilled predictions of steep drops that were fueled primarily by high-linepack OFOs by both of California’s biggest LDCs.

Coming as no surprise due to the recent announcements that exploration and production companies are slashing their drilling budgets because of unfavorable natural gas commodity prices, Houston-based offshore drilling contractor Global Marine reported that its worldwide Summary of Current Offshore Rig Economics (SCORE) for September 2001 decreased by 4.3% from August 2001.

Coming as no surprise due to the recent announcements that exploration and production companies are slashing their drilling prospects because of unfavorable natural gas commodity prices, Houston-based offshore drilling contractor Global Marine reported that its worldwide Summary of Current Offshore Rig Economics (SCORE) for September 2001 decreased by 4.3% from the previous month.

To no one’s surprise, softness ruled in Friday’s trading for the weekend. Most price drops ranged from about a nickel to a quarter, with those in the vicinity of a dime most common. The larger declines tended to be at western points, and weekend OFOs caused border-SoCalGas and the PG&E citygate to register plunges on either side of a dollar.

After a positive surprise with its fourth quarter earningsperformance, Phillips Petroleum continued to astonish observerslast week, buying Tosco Corp. in a $7 billion stock transactionthat will make Phillips the second-largest refining company in theUnited States with a capacity of 1.7 MMbbl/d.

After a positive surprise with its fourth quarter earningsperformance, Phillips Petroleum continued to astonish observersover the weekend, buying Tosco Corp. in a $7 billion stocktransaction that will make Phillips the second-largest refiningcompany in the United States with a capacity of 1.7 MMbbl/d.