The cash market was relatively quiet Monday, and for quite a fewtraders, dismayed by last week’s hypervolatility, that suited themjust fine. Points in the East tended to range from flat to about anickel or so higher, while the West was considerably stronger withadvances of about a dime or more in most cases.
Other than a moderately supportive gas futures screen, there waslittle to distinguish Monday’s cash activity, sources said. Most ofthe hoopla had shifted over to the crude oil futures trading pit,where the July contract soared by a little more than a dollar and ahalf to $31.74/bbl.
After a hot weekend that saw temperatures in New York’s CentralPark exceed 90 degrees Sunday, weather in the Midwest had cooledoff rapidly. The dropoff in air conditioning load was quite notableto a trader who had only one MichCon package in the mid $4.20s toreport. “I couldn’t get anything else done because these prices arestill paralyzing everybody,” he said.
In contrast to the Midwestern cooldown, heat was building inmuch of the West, especially in California and the desertSouthwest. Parts of inland California were expected to pass 100degrees today, and that was already happening Monday in theSouthwest. The extra cooling demand helped boost prices bydouble-digit amounts at most western points, led by a gain of 40cents at the Southern California border.
Although this past weekend was atypical of recent weeks in thatthere were no California OFOs issued as of Friday, the potentialfor them had kept Friday’s western upticks milder than those in theeast, an aggregator pointed out. Thus there was another good-sizedrebound Monday even though PG&E had a high-linepack OFO inplace for Monday only (see Transportation Notes), he said.
A staffer at one marketing company said he was out of the daymarket for the time being. “Our bosses told us to stay flat thismonth because of all the volatility,” he said, adding, “But it’sbeen great in futures lately if you were able to take advantage ofthe big swings up and down.”
Traders in downtown Calgary reported that protesters had shownup there for the World Petroleum Congress, but were not causing anytrouble. “My colleague saw some [protesters] around thePetro-Canada tower,” a marketer said, “but they just madethemselves highly visible without a lot of noise.”
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