Physical natural gas prices for Wednesday delivery continued on average to be buffeted by the volatile Southern California market points as some additional supplies made their way to the SoCal system. SoCal Citygate dropped nearly $5, and the NGI National Average fell 7 cents to $2.74.

Most other market points, however, came in about a nickel to a dime lower with weakness in the Rockies and Appalachia offsetting strength in the Northeast.

Futures waffled in a 4-cent range and failed to settle above the pivotal $3 level. At the close November had lost 1.7 cents to $2.974 and December was down 2.1 cents to $3.135. December crude oil added 57 cents to $52.47/Bbl.

Temperatures were expected to stay elevated across the LA Basin. AccuWeather.com forecast the high Tuesday in Los Angeles of 105 would slide to 100 by Wednesday before dropping to 90 on Thursday, well above the norm of 77. Burbank, CA, was expected to see a high of 102 Tuesday and Wednesday before max readings were forecast to fall to 91 on Thursday. The normal high in Burbank is 78 this time of year.

Like temperatures, next-day gas at California points remained elevated in Tuesday’s trading. Gas at the SoCal Citygate fell $4.93 to $7.64 and deliveries to the PG&E Citygate gave up 9 cents to $3.20. Gas on Kern Delivery fell 17 cents to $3.34.

“SoCal got more gas from Kern, about another 125 MMcf/d, and that’s important since it is the only one of five at that location that is not limited to zero,” said Genscape analyst Joe Bernardi.

“We’ve also seen SoCal receipts increase from El Paso Ehrenberg and there is a third point where they are importing gas from Mexico.”

Weather forecasts paint a risky picture of high winds and warm temperatures for the region. AccuWeather.com meteorologists reported that “a Santa Ana wind event will bring a strong offshore flow into Southern California with winds, especially downwind of mountain passes, exceeding 50 mph at times.”

“The air will warm as the wind flows downhill from the mountains toward the coast. Long-standing record highs may be broken as temperatures soar into the 90s and lower 100s. Temperatures will lower as the Santa Ana weakens late this week but remain above normal,” according to AccuWeather.com meteorologist Jack Boston. “Highs 20 to 25 degrees Fahrenheit above normal through Wednesday will be replaced with highs 5 to 10 degrees above normal by Friday. The amount of moisture in the air will remain at very low levels, making it easy for a new blaze to ignite.”

Other points were mixed. Gas at the Chicago Citygate rose 4 cents to $3.02 and deliveries to the Henry Hub fell 2 cents to $2.92. Gas on El Paso Permian shed 11 cents to $2.58 and packages priced at Northern Natural Demarcation skidded 2 cents to $2.87.

Packages at the Algonquin Citygate rose 21 cents to $3.08 and gas on Dominion South was flat at $1.08. Gas on Tetco M-3 Delivery fell a nickel to $1.13 and gas bound for New York City on Transco Zone 6 added 4 cents to $2.92.

Futures traders are willing to give the bulls the benefit of the doubt for now. “It’s starting to get a little cooler across the country so you are starting to see a little lift in the market,” said a New York floor trader. “If the market takes out $3.06 I think it will reach $3.08 and then into the mid-teens,” he said.

“This market traded within an unusually tight 5-cent range today amidst mixed signals from the temperature forecasts,” said Jim Ritterbusch in closing comments Tuesday. “Although consensus of views appears to favor cooler than normal patterns within the six-to-14 day time frame, deviations don’t appear sufficient to force major elevation in [heating degree day] expectations. This is why nearby futures continue to experience difficulty in maintaining values north of the $3 mark.

“Regardless, we still see more upside than downside near-term potential and we would prefer to work this market strictly from the long side on price pullbacks. Such a short term correction could be forthcoming off of Thursday’s [Energy Information Administration] report in spite of the fact that we expect further expansion in the small supply deficit against average levels of around 12 Bcf.”

Others see the December contract vulnerable. “The market has gotten very sticky in this $3.00 area in the front again, especially after Thursday’s brief washout in X [November], it only strengthened my belief in the short-term the downside remains limited,” Stephen Kessler, Beacon Energy Group desk head and broker, said in ICE’s Weekly Natural Gas Market Commentary on Tuesday.

“The bigger issue is that for the moment the upside remains limited, the market desperately needs a sustained change in the weather to shake us loose. As Z [December] will be the spot month by week’s end it does not look particularly cheap to me (in vol terms) with break-evens near .075-.08 and the straddle will roll on to the board somewhere around .30. That could bleed quickly given how stuck the underlying has been.”