Physical natural gas for Tuesday delivery bounded higher Monday as traders noted a double-digit differential between the screen and Henry Hub quotes. Gains in California and the Rockies helped lift more sluggish points in the Midwest. The NGI National Spot Gas Average rose 15 cents to $1.88.

Futures quotes moved a little, but that was enough of a magnet to lift cash quotes from Friday’s depressed levels. June eased a microscopic .03 of a cent to $2.098, and July came in 1.4 cents lower at $2.229. June crude oil fell $1.22 to $43.44/bbl.

At Friday’s close, the NGI Henry Hub averaged $1.84, a stout 26 cents below the June futures settlement of $2.101. June futures don’t expire until May 26, but it was too much for the market to ignore in Monday’s trading. Henry Hub physical bounded higher 13 cents to $1.97.

The loftiest point tabulated byNGI for Tuesday was the Algonquin Citygate at $2.20, down 6 cents. Restrictions on some points on the Algonquin Pipeline have not only reached interruptible transportation, but in some cases holders of firm transportation as well.

Industry consultant Genscape Inc. reported that Algonquin Gas Transmission (AGT) for Monday (May 9) had “restricted 100% interruptible, 100% secondary out of path, 100% secondary in path and approximately 10% of primary firm nominations sourced from points west of its Stony Point Compressor Station (Stony Point) for delivery east of Stony Point.”

Other New England points also held prices well above $2.00. Deliveries to Iroquois, Waddington eased 4 cents to $2.16, and parcels on Tenn Zone 6 200L shed 8 cents to $2.14.

Points downstream from the Tetco rupture and explosion continue to see higher pricing (see Daily GPI, May 4). Gas on Texas Eastern M-3, Delivery added 17 cents to $1.58, and packages bound for New York City on Transco Zone 6 added 31 cents to $1.75.

Other market centers gained as well. Chicago Citygate rose 7 cents to $1.96, and deliveries to El Paso Permian added 26 cents to $1.90. Gas priced at the SoCal Border Avg. Average gained 23 cents to $1.97.

California gas used for power generation got a modest boost as the California Independent System Operator (CAISO) forecast higher loads Tuesday. Monday’s peak load of 28,840 MW was expected to reach 29,463 MW Tuesday.

Temperatures in the desert southwest were forecast well above normal. AccuWeather.com predicted Monday’s high of 89 degrees in Dallas would reach a toasty 93 Tuesday before easing to 86 Wednesday. The normal high is 82. Oklahoma City’s high of 85 on Monday was seen advancing to 89 Tuesday before dropping back to 87 Wednesday. The seasonal high in Oklahoma City is 79.

In its Monday morning six-to-10-day outlook, MDA Weather Services said the forecast over the weekend “saw significant cool changes focused on the eastern two-thirds of the U.S., which comes with a stronger push of high pressure into these areas in the wake of ridging” near Alaska Eastern Pacific Oscillation. “With this, temperatures are now expected to fall below normal from the Midwest to the East, with readings peaking at much below normal levels from early to mid-period in the Midwest.

“While there remains additional cool risk that could average the period in the much below normal category in the Midwest per the GFS [Global Forecast System] model, moderation is forecast late as western ridging breaks down.”

MDA said risks to the forecast include moderation late in the period could be slower to evolve, lending cooler risks for the Eastern Half. The South carries cooler risks as well, based on the GFS model.

Risk managers don’t see the market going anywhere far anytime soon.

“Over the past few weeks, the gas market has been working higher, especially the deferreds,” said DEVO Capital President Mike DeVooght in a weekend note to clients. “We continue to see a decline in open interest, which indicates that the funds, which have been carrying a large short position for quite some time, are starting to liquidate their positions.

“Natural gas will most likely be in a holding pattern until we get deeper into the summer cooling season. If we get warmer than normal temperatures early in the season, we could move back into the mid-$2 range. On a trading basis, we will continue to stand aside and await further developments.”

DeVooght recommended standing aside the market for now, but should the June-October strip trade up to $2.70, he recommended that producers and physical market longs initiate short hedges. The June-October strip, however, settled Friday at $2.296.

In an early survey of this Thursday’s storage report, Energy Metro Desk editor John Sodergreen said a sample of 10 observers resulted in an average injection of 61 Bcf. Last year 101 Bcf was injected, and the five-year pace stands at 79 Bcf.