For the third straight day, unseasonable weather teamed with afalling futures screen to land a knockout blow on price bulls’chins, as only a few cash points escaped losses of more than adime. A huge swath of high 60- to mid 70-degree temperatures acrossthe Rockies, Gulf Coast, Midcontinent and Northeast eradicated anywinter demand yesterday and caused traders to long for the golfcourse instead of the office. Adding fuel to the fire, forecastsare calling for similar weather for the rest of the week.

“I would have played golf but didn’t want to sweat,” one Midwestmarketer said. “But what’s good for the golf game is bad forprices. November Chicago prices are trading at the futures screenminus 21 today.”

More than one source mentioned that prices are nearing lastyear’s weak levels. In Chicago, where temperatures reached the mid70s, the citygate finished trading in the mid $2.40s, compared tothe mid $2.30s last year. Transco Zone 6 (New York), dropped nearly30 cents yesterday to finish in the mid $2.60s, which is only adime higher than its year-ago price. The small rebounds inCalifornia earlier in the week were wiped out yesterday, as boththe SoCal Border and the PG&E citygate fell significantly toend more than 40 cents below their respective index levels.

Still, one California source said PG&E has stood up well tothe overall price decline. “There is a little heating demand inNorthern California and the linepack situation is back closer tonormal. People have been drafting the pipe pretty good for the lastfew days so we probably won’t even see a high inventory OFO thisweekend.” One reason for the increased California demand may be thehigh electricity prices in the region. Electricity was sellingbetween $40-$50 yesterday on the California Power Exchange.

No demand existed in the Rockies. “Questar is packed up big time,”one western source said. “Maintenance on Kern River (see Daily GPI, Nov. 8) has really made people long onQuestar. Utilities in the Pacific Northwest have also been packingNorthwest pipeline, because their loads have been as much as one-thirdbelow what they expected.”

Another Rockies source said many pipes in the region arecontemplating high linepack OFOs, including Colorado Interstate Gas(CIG), Public Service of Colorado, Questar. Northwest calledunderrun entitlements Tuesday. To prove the dire situation, thetrader quoted an intra-day deal on the CIG system for $1.85.Intra-day Northwest prices were also quoted under $2.00.

“We keep diving below support levels,” a Midcontinent sourcetold NGI. “It’s weak across the board and a whole bunch ofMidcontinent pipes are trading 30 cents below the screen. The10-day out forecast is supposed to be colder, but it seems likethat is what the forecast always says and it never happens.”Northern Natural’s Demarcation point lost 14 cents to finish in themid $2.30s, while NGPL Midcontinent lost 15 cents to finish in thehigh $2.20s on the day.

While other Northeast points tumbled yesterday, Northeast Algonquinonly fell a couple pennies. “They issued a restraint at the Hanovermeter, which began [yesterday],” a Northeast marketer said (see DailyGPI, Nov. 8). The only gas gettingthrough at that point is firm primary transportation. The originalnotification of the maintenance was sent out Nov. 4, but it saidnothing about constraining flow.”

Transwestern’s maintenance at its Thoreau Flow West point backedgas into the San Juan basin, a western source said, and helped ElPaso San Juan prices drop into the low $2.20s. Deals in the basinfell as low as the high $2.10s.

There was a small, late rebound in Sonat prices, which had oneFlorida trader bullish about today. “It got as low as $2.38 andtraded in the low $2.40s for most of the day. At the end, however,I saw some deals done in the mid $2.40s. I think that will carryover to [today]. I’m not expecting prices to drop into the $2.30seither on Sonat or on the Florida pipes.”

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