Subject: RE: market
From: [email-masked]
To: [email-masked]
Date: Wed, 17 Oct 2001 19:49:42 -0700 (PDT)

john- thank you.. what do you mean by storage adjusted prices?  and also comment on non-discretionary stg at peak times.. why in producing region? 

-----Original Message----- 
From: Arnold, John 
Sent: Tue 10/16/2001 11:03 PM 
To: Abramo, Caroline 
Cc: 
Subject: RE: market

Thanks.
Surprised your shorts are still so confident.  Trade shorts are quickly losing confidence based upon cash, shape of curve, and momentum.  I think curve flattens a little more and then comes down in parallel shift down.
1.  jan and feb are highest storage adjusted prices on curve.  For market area sales, add on basis and dec and march are next.  Question is whether there is enough non-discretionary stg to meet load at other times and in the producing region.  A lot of stg has to come out either for tariff or engineering reasons.  Million dollar question.  
2.  Think Nov bidweek will be weak.  Don't know who baseload buyers are unless trade gets bullish.  Nov is a relatively flat month as far as injections.  stg operators dont have room to buy baseload gas and I think utilities will be planning to meet load using stg.  At current prices, producers apply more pressure to wells, lng doesnt get diverted again, lose some load to resid, lose any momentum of industrial load coming back.  Dont think gas market can handle that.  
3.  No clue.

-----Original Message----- 
From: Abramo, Caroline 
Sent: Tue 10/16/2001 10:21 PM 
To: Arnold, John 
Cc: 
Subject: market

awesome call on cash.. it does not get any better than that.. you picked the bottom-  i am getting it slowly.. lots of calls today from people i do not speak to every day.. not too much panic from guys who are short.. most looking to put more on.. selling dec01 outright or buying gas daily puts on dec and jan... except pulaski  who pared down dec01 short with us from 4000 to 1000.. do not think he's got on alot elsewhere.  no one has anything on longer dated.. no one can figure out economy...
 
questions:
1. why would any of the discretionary storage operators withdraw gas in the winter based on the current curve?
2. where do you think index gets set this month? i am thinking that utilities will overestimate loads for Nov01 and buy more during bidweek.. index gets set high and depending on Nov weather.. it could come back onto the market weakening cash again..
3. do you have a view on eastern power for the winter? i do not understand the market drivers in the winter.
 
thanks very much,
c