Both physical natural gas for weekend and Monday delivery and futures fell in Friday’s trading. Physical traders saw no reason to commit to three-day deals with mild weekend temperatures expected and abundant storage.

In some metropolitan areas temperatures were forecast close to 20 degrees above normal. The NGI National Spot Gas Average dropped 9 cents to $1.68, led by eastern declines running close to 20 cents. Futures bulls threw in the towel when the April contract failed to meet short-term objectives. At the close March had fallen 4.8 cents to $1.804 and April was off 6.0 cents to $1.867. March crude oil skidded $1.13 to $29.64/bbl.

Nymex floor traders were looking for the market to hold a key support level. “It tried to hold and we were looking for April to hold right at $1.88 to $1.89, and when it didn’t the market dropped another 2 cents,” a trader told NGI. “There is cold weather out there, and I think natural gas should be over $2 but the whole complex is dragging it down. It’s really disheartening.”

Cold is relative and temperatures aren’t expected to turn much colder in the next two weeks, according to forecasts. Traders are already looking ahead to winter when demand for the fuel will fall further.

“With temps forecast to be in the mid 50s here in the New York City area, all signs continue to point lower” for natural gas prices, said Frank Clements, co-owner of Meridian Energy Brokers Inc. in New York, in a note.

Analysts still see the bottom open relative to futures markets. “Updates to the short-term temperature views still appear bearish with above-normal temperatures spread broadly across the western half of the U.S.,” said Jim Ritterbusch of Ritterbusch and Associates in a note to clients. “As a result of these weather forecasts, it would appear that additional major expansion in the supply surplus lies ahead.”

Ritterbusch sees Thursday’s storage at 2,706 Bcf and that combined with “an unusually mild March eventually resulting in an end-of-season supply that could easily approach 2.3 Tcf. In the background, an ongoing tendency toward price-induced coal-to-gas substitution is still being overwhelmed by a recent upswing in production out of the prolific eastern region. And while the recent accelerated decline in the rig counts has helped to slow price declines, it has not yet been able to drive a bottom into this market.

“Another round of lows would appear to set up further declines to the lows in the January 2016 futures that were established in December at the $1.68 area. However, we are viewing this level as out of reach assuming normal temperature trends across the month of March. For now, we will suggest acceptance of profits at the 1.91 level per April futures that would imply a gain of around 30 cents from suggested entry point. From there, we will await a price advance back into the 2.00-2.10 zone to re-establish a bearish holding.”

Gas buyers for power generation across the MISO footprint should have abundant wind generation Friday but will likely be augmenting that power with purchases for the balance of the weekend, according to forecaster WSI Corp.

“An area of low pressure will continue to traverse the northern tier today with a little light rain, mix and snow,” the forecaster said. “A strong south to west-northwest wind will pump anomalous warmth into the region during the next couple of days. High temps will range in the 30s, 40s and 50s north; 60s and 70s south. A cold front will begin to sag southward during Sunday into Monday with a chance of rain and snow showers. This will usher colder, more seasonable conditions into the power pool early next week with highs in the 20s, 30s and 40s north; upper 40s, 50s and 60s south.

“The frontal system will lead to high winds and strong wind generation [Friday]. Total output is forecast to peak 10-12 GW. Wind generation will abruptly decrease during Saturday and remain relatively light into the start of next week.”

In the physical market much above seasonal temperatures in key markets knocked the socks off spot prices for weekend and Monday delivery. Forecaster Wunderground.com predicted the high Friday in New York City of 38 would rocket to 61 Saturday and ease down to 46 by Monday, still 3 degrees above normal. Chicago’s Friday high of a comfortable 64 was seen sliding to 54 by Saturday and dropping to 36 by Monday, the seasonal norm.

Gas at the Algonquin Citygate shed 89 cents to $2.05, and Iroquois, Waddington came in 17 cents lower at $1.97. Gas on Tennessee Zone 6 200 L fell 86 cents to $2.18.

Marcellus points weakened as well. Gas on Dominion South fell 12 cents to $1.23, and deliveries to Tennessee Zn 4 Marcellus shed 15 cents to $1.04. Gas on Transco-Leidy Line gave up a dime to $1.09.

Major market hubs were soft also. Gas at the Chicago Citygate slumped 4 cents to $1.88, and deliveries to the Henry Hub shed 6 cents to $1.81. Gas on Kern River changed hands 4 cents lower at $1.55, and parcels at the SoCal Citygate dropped 8 cents to $1.82.