With two hurricanes moving away from the Gulf of Mexico and influences from weather and storage still as negative as they were prior to the weekend, it was natural for most prices to be softening Monday. The exceptions to declining numbers were chiefly in the rebounding West and at Northeast citygates.

Sources were in agreement that all points should be united today in downward price movement. Most cash business was already done before the screen began its swan dive toward an eventual daily loss of a little more than 32 cents, and virtually all of it had been concluded while the December contract was still north of $3, they said.

“No one I’ve talked to knows what was keeping Northeast prices higher,” said a regional marketer. The weather is chilly there, but it doesn’t seem cold enough to have justified Monday’s double-digit upticks, he added. However, the marketer agreed that the price rout in the Nymex pit will bring prices lower again today.

A Midcontinent/Midwest trader said that for right now, the lack of any hurricane threat and mild regional weather were the chief reasons for prices in his region falling about a dime or so. “The other thing is that we’ve had a forecast for cold weather in November, and every day we come in that forecast seems to be revised and the date [when] the cold will arrive gets pushed back. Originally we were supposed to get a cold snap around the 6th, and now they are saying sometime after the 15th.”

The absence of any California utility OFOs allowed a general western recovery from Friday’s extreme weakness. However, prices probably would have realized even larger gains if it hadn’t been for the screen’s negative drag, an aggregator said.

Intra-Alberta was a rare falling western market primarily because it trades throughout the day and had more time to react to the plunge in futures.

Noting the steep screen dive, a Gulf Coast buyer commented, “The fundamentals are back in charge. After weeks of crazy, shoulder-shrugging prices, it [market] makes sense again.” He went on to express doubt about how the current financial predicament of Enron could have any positive effect on prices, although acknowledging that some in the trade press were “theorizing that up a storm. I’m not sure we will ever know the answer to where the mysterious strength [of the market recently] came from or went to.”

As last weekend approached Hurricane Michelle was given an outside chance of altering course enough to brush the outskirts of eastern Gulf of Mexico production. It didn’t happen, and Monday afternoon Michelle was weakening as it continued eastward after passing over the Bahamas.

There was more hurricane news, but it was much farther removed from Gulf platforms than Michelle. A non-tropical low in the North Atlantic became Hurricane Noel, the eighth hurricane of the 2001 Atlantic season. It was moving northward and expected to pass close to eastern Newfoundland today, where the cold waters would be sapping its strength.

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