Tracking Nymex, August Bidweek Bulls Up in Most Regions

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August bidweek monthly contract prices rose unevenly from coast to coast as last week’s futures settlement at seven-year highs forced most eastern US basis markets higher. However, more demand-driven regions outside California saw smaller gains and even losses. The extraordinary 56.1-cent surge during the expiring contract’s last two weeks may have been overdone, as some analysts contend. But the $4.044 per million Btu settlement stands nonetheless, pushing the benchmark Henry Hub monthly cash price up 43¢ to $4.05/MMBtu. That result reverberated in the Upper Midwest, where the Chicago citygates rose 50¢ to $3.90/MMBtu. However, the Appalachian region next door is beginning to show signs of stress, with Columbia Gas Appalachian Pool rising 20¢ to $3.23/MMBtu while Eastern Gas South (formerly Dominion South) was up 19¢ at $2.89/MMBtu. A probable cause for Appalachia’s lackluster gain is an even more anemic result in its key Northeast market, led by a decline at Transco zone 6-New York. The New York city gate fell 5¢ to $3.27/MMBtu. In New England, Algonquin rose 9¢ to $3.46/MMBtu – a 59¢ discount to the Henry Hub. Its companion pipe in the region, Tennessee Gas Zone 6, tumbled 17¢ to average $3.44/MMBtu for the month. Results were also mixed in the West, as Southern California’s SoCal Citygate again led the survey with a 48¢ gain to average $7.60 for the month. Northern California’s PG&E Citygate was second in line, rising 62¢ to $5.61/MMBtu. A steep climb was also seen in the Permian Basin, as the Waha Hub rose 51¢ to $3.85/MMBtu. However, most western regions were not nearly as robust. Rockies leader Kern River/Opal was up 21¢ at $4.05/MMBtu. But Sumas only managed a 3¢ rise to $3.97/MMBtu, while Western Canada took a dive. Alberta benchmark Aeco fell 27¢ to average $2.65/MMBtu as uncertainty builds on how a 10% restriction on interruptible gas flows at Nova Gas Transmission Ltd.’s Eastern Gate could impact the market. But Canadian producers are not likely to complain as Aeco’s August 2020 bidweek price was $1.46/MMBtu. Meanwhile, Westcoast Station 2 in British Columbia fell 5¢ to average $2.75/MMBtu. Tom Haywood, Houston

Gas Demand, Gas Prices
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