Message-ID: <17891074.1075861045459.JavaMail.evans@thyme> Date: Wed, 6 Mar 2002 06:16:50 -0800 (PST) From: marketing@nymex.com To: marketing@nymex.com Subject: (02-68) Request for assistance in communicating the importance of the weekly natural gas storage report to the Department of Energy Mime-Version: 1.0 Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: 7bit X-From: Exchange Information @ENRON X-To: Exchange Information X-cc: X-bcc: X-Folder: \Sara_Shackleton_Mar2002\Shackleton, Sara\Deleted Items X-Origin: Shackleton-S X-FileName: sshackl (Non-Privileged).pst Notice # 02-68 March 5, 2002 To: All NYMEX Division Members NYMEX Division Member Firms From: J. Robert Collins, Jr., President Re: Request for assistance in communicating the importance of the weekly natural gas storage report to the Department of Energy The U.S. Department of Energy Energy Information Administration (EIA) will take over the release of the weekly natural gas storage report from the American Gas Association this spring. Since its inception in 1993, the survey has been an important source of on-going changes in the supply and demand of natural gas, and plays an important role in the transparency of the market. While at the present time the report is released during open outcry trading hours, the Exchange has reason to believe that the EIA is leaning toward releasing the numbers in the late afternoon or on the weekend. Officials at the EIA have said they believe this will minimize the volatility in the marketplace. It is the firm belief of the Exchange that releasing the weekly storage report in the off-hours will only increase market volatility upon the resumption of open outcry trading, will limit market transparency, and would put many market participants at a disadvantage. In the interests of market transparency and fairness, the Exchange is concerned that the report be released during open outcry trading hours when the market is most liquid, and has suggested a time of 10:30 A.M. The Exchange has made its position known in written comments to the Department of Energy. EIA Administrator Mary Hutzler has said that the Exchange appears to be the only interested party that feels strongly about releasing the data during regular trading hours. It is important that market participants, particularly commercial entities, contact the EIA on this issue. I urge you and your customers to call Ms. Hutzler, (202) 586-6351, and cordially explain how important it is to have the information made available during regular daytime trading hours, preferably 10:30 A.M. Please make the following points: ? The weekly inventory report is an important source of information regarding changes in the supply and demand of natural gas. It is currently released to coincide with regular daytime trading hours of the natural gas futures market. ? Wide participation in the New York Mercantile Exchange natural gas futures market by commercial buyers and sellers from all segments of the industry has made the futures contract the North American pricing benchmark. ? The release of the report in the late in the afternoon, or early in the morning when the trading floor is closed, will put most market participants at a distinct disadvantage to those firms who have trading desks manned round the clock. ? The release of the information in the off hours could also increase volatility at the opening of the market -- having the opposite of the desired effect. ? In the interests of fairness and market transparency, it is vital that the statistics continue to be released according to current practice, during daytime trading; one of the most active times of the day is shortly after the market open, or about 10:30 A.M. If you prefer to fax Ms. Hutzler at (202) 586-0329, or email mary.hutzler@eia.doe.gov, we have provided the following recommended language: Ms. Mary Hutzler Administrator Energy Information Administration U.S. Department of Energy Washington, DC Dear Ms. Hutzler: Since its inception in 1993, the American Gas Association's weekly inventory survey has been an important source of on-going changes in the supply and demand of natural gas, and has fulfilled an important role in assuring the transparency of the market. We understand that the reporting function will be assumed by the Energy Information Administration this spring, and wish to urge that in the interest of market fairness and efficiency that the weekly report continue to be released during regular daytime trading hours of the natural gas futures market. Wide participation in the New York Mercantile Exchange natural gas futures market by commercial buyers and sellers of gas from all segments of the industry has made the futures contract the North American pricing benchmark for this important energy resource. For this reason, we feel that it is vital that the statistics continue to be released according to current practice, during regular daytime trading hours, the most active trading period. Typically, one of the most active times of the day would be shortly after the market opens, about 10:30 A.M. A release of the inventory figures in the late afternoon or on the weekend would primarily benefit the major companies that can afford to man round-the-clock trading desks because they will be able to react immediately, while smaller firms will have to wait until the market opens on the following business day. It has been our experience that the release of market-moving news in the off-hours often increases market volatility at the market open. We urge you to maintain the current practice of releasing this information during daytime trading. Thank you for your consideration. Sincerely,