As many traders had expected, prices were unable to sustain thestrong upward momentum with which they began the week. Even asblizzard conditions got worse Tuesday in several major marketareas, quotes for today’s gas flow were flat to as much as a nickellower. Apparently utilities and other end-users started leaningmuch more heavily on their storage accounts after Monday’s cashrun-up left many points trading well above first-of-month indexes,especially in Eastern markets, one source said.
A serious winter storm raged from the Midwest through the MiddleAtlantic region Tuesday, and a forecasting service said another oneis due toward the weekend. Parts of the Upper Plains and Rockiesalso were either experiencing or expecting snow.
Despite the modest price softness, there still seemed to befairly strong demand for Gulf Coast gas, a marketer said. Gulfprices were off at first but were regaining lost ground in lateactivity, she said. Rockies and Sumas traders similarly reportedlate surges in buying.
Transco Zone 6 was Tuesday’s sole point to manage increases ofmore than a penny.
One trader thought the Henry Hub futures contract was derivingits strength from cash, and in turn would lend support back to cashlater this week. He reported hearing talk that some think the $2level is attainable on the screen. But another source expects thisafternoon’s AGA storage report to be considerably lower than lastweek’s; he’s looking for “somewhere in the 80s [Bcf]” inwithdrawals.
A marketer reporting Midcontinent field pricing in the mid$1.70s, approximately even with his NGPL Amarillo Line numbers andonly 2-3 cents under NGPL Iowa-Illinois, called such near-parityunusual, saying the points more often are a nickel or more apart.”That doesn’t give us much spread to work with,” he complained.
Echoing a sentiment first expressed during the March bidweek, aWestern source said Malin is being very thinly traded this monthbecause prices there (high US$1.60s Tuesday) were too low comparedto intra-Alberta (mid C$2.20s).
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