Coal shortage, heat prop up September NYMEX gas contract

Coal shortage, heat prop up September NYMEX gas contract

Washington (Platts)--2Aug2005

After opening 3.6 cts higher, the September NYMEX gas futures fell flat by
Tuesday midday near Monday's close of $8.154/MMBtu. "It's chopping around here
[Tuesday]," said a New York-based broker. "The market is still bullish with
the heat coming back and the short-term power prices very strong." 

Traders also were concerned that a coal shortage will force off-peak power
plants to burn more gas, he said. "That's what basically is keeping prices
supported," he said. While prices may retrace somewhat, he said, "I think we
have room to run on the upside. I can see us running up to $8.50/MMBtu." The
contract opened at $8.19/MMBtu and has traded between a high of $8.23/MMBtu
and a low of $8.13/MMBtu.

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