Small single-digit advances dominated the market Monday as (1) industrial demand picked up again after the holiday weekend, (2) futures remained supportive of physical prices and (3) a cold front invading the Midwest from Canada late last week had spread southward to Texas and eastward into the Mid-Atlantic and Northeast.

Despite the overall mild bullishness, there were quite a few flat points in the market mix and Northern Natural’s demarcation and Ventura points saw declines of about a dime due to Tuesday highs predicted in the 60s and 70s in the pipeline’s central and northern Plains market areas. The West, where summer-like heat is starting to resurface in the desert Southwest, garnered the lion’s share of gains around a dime or greater.

A marketer in the Midwest expects prices to keep going up a bit more Tuesday, saying some cold weather would still be hanging around and the cash market also had the example of energy futures strengthening further Monday. The natural gas screen “started out in the red this morning but later went to green [higher],” she said, adding that she was hearing the natural gas contracts were lifted by the spikes in oil-based products. However, the cash market should start seeing some softness after midweek as the Midwest is expected to see highs around 70 degrees Friday, the marketer said.

Gas futures rose only 6.8 cents Monday, but the important thing was the May contract settling at $6.009, just above the pyschologically key level of $6, one source said. The Nymex fireworks were a little more spectacular in the trading pits of the oil products. Crude hit a daily high just a nickel shy of $38/bbl before settling at $37.84, while unleaded gasoline at New York Harbor recorded its all-time high of $1.1830/gallon before finishing at $1.1803.

News reports cited the continued violence of fighting in Iraq, growing refining demand from China and ancillary strength from the gasoline contract as behind oil’s strength. The line on gasoline was that despite Americans’ propensity for complaining about recent record high retail prices at the pump, they show little inclination to cut back their demand for the fuel with the summer driving season approaching.

There’s really not much change in the post-holiday market, and it’s staying quiet, according to an intrastate Texas marketer. Traders in Houston and Dallas may have gotten a moderately bullish feeling from needing to wear coats to work Monday, he said, but there wasn’t much utility load in Texas for either cooling or heating after a cold front moved in over the weekend. The front cut back on a lot of air conditioning use but didn’t lower temperatures enough to replace it with much heating demand, he explained. One guy in

One Houstonian said it had cooled off his condominium “just enough to keep the air conditioner from cycling on since Sunday afternoon,” the marketer reported. He was still seeing “fairly good storage buying,” though. There was a little squeeze upward in late deals that likely was tied to natural gas futures starting to rise along with oil, but it had little impact because by then only a little cash trading was left to be done.

A Calgary-based producer said several trading counterparties were still out of the office on what’s called the Easter Monday holiday, so that limited market liquidity to some extent. He also noted that Northwest was making cuts at the Chehalis (WA) Station, which caused some export grief at Sumas “as you had only a short window of opportunity to get nominations in” before available capacity filled up.

Lehman Brothers analyst Thomas Driscoll, noting that last week’s weather was 6% warmer than the 30-year norm and 29% warmer than last year during the comparable period, expects a storage injection of 15 Bcf to be reported for the week ended April 9. This would compare with a year-ago withdrawal of 46 Bcf. “If our storage estimate is correct, the storage surplus versus a year ago will increase from 346 Bcf to 407 Bcf and the storage variance versus five-year averages would decrease from a 63 Bcf deficit to a 57 Bcf deficit,” Driscoll added.

Over at Citigroup, analyst Kyle Cooper gave his final estimation of Thursday’s report as a build between 11 Bcf and 21 Bcf.

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