Spot natural gas for Tuesday delivery bounded higher in Monday’s trading, with only one western point not in the plus column and most locations posting multi-dollar gains. Lowest increases were just under $1.00, but at the extreme end, prices gained close to $15.00. Eastern points led the charge higher, but New England and the Great Lakes were not far behind. Futures headed south. At the close, March was down 19.6 cents to $4.579 and April lost 11.0 cents to $4.406. March crude oil added 18 cents to $100.06/bbl.

Next-day prices at eastern points surged higher as a high pressure system and a chilling cold were forecast. Forecaster Wunderground.com said the Monday high of 30 in New York City would drop to 26 Tuesday before inching to 27 on Wednesday. The normal highthis time of year is 41. Boston’s high of 28 was predicted to fall to 24 Tuesday before moving to 26 Wednesday. The seasonal high is 38.

The National Weather Service in New York City said “unseasonably cold…dry conditions will prevail through middle week as a large area of polar high pressure over the upper Mississippi Valley builds east. Aloft…an upper trough across the Great Lakes and northeastern states gradually works east during the period. A deep-layered west/northwest flow will maintain an influx of cold air.”

In addition, “a large area of high pressure over the upper Mississippi Valley will build east through middle week…moving across the Tri-State area on Wednesday. Low pressure then develops along the Southeast coast Wednesday night and passes south and east Thursday. A couple of weak low pressure centers move across the area this weekend.”

Gas for delivery Tuesday at the Algonquin Citygates jumped $4.87 to $27.37, and packages into Iroquois Waddington added $5.55 to $25.30. On Tennessee Zone 6 200 L, next-day gas was quoted at $26.78, up $5.21.

Deliveries to eastern points galloped higher as well. Deliveries to Transco Leidy added $1.27 to $3.43, and on Dominion next-day gas changed hands at $7.26, up $1.98. Gas on Tetco M-3 Delivery added a stout $12.45 to $21.85, and gas bound for New York City on Transco Zone 6 rose by $7.95 to $20.33.

Prices in the Midwest also surged higher with temperatures forecast well below zero. “Frigid sub-zero cold will be enhanced with northwest winds creating minus 15 to minus 25 degree wind chills Monday morning,” said the Chicago Weather Center. “As temperatures work their way above the zero mark by late morning, the center of Arctic high pressure will move southeast out of Minnesota — tracking directly overhead here Monday night.

“Winds will die off, and under clear skies and a thick snow cover, temperatures are expected to fall rapidly after sunset — bottoming-out as low as minus 15 to minus 20 degrees after midnight and early Tuesday morning. After another cold day Tuesday, the center of high pressure will drift off to the east and winds will shift southerly — allowing readings to finally begin a rebound that could see above 32-degree readings here for the first time in two weeks, on Thursday.”

Wunderground predicted Chicago’s 18 high on Monday would fall to 15 Tuesday before rising to 21 on Wednesday. The normal high in the Windy City is 34. Minneapolis hit 8 degrees on Monday, with forecasts rising to 14 on Tuesday and 18 by Wednesday. The normal mid-February high in Minneapolis is 27.

Tuesday gas on Alliance added $4.45 to $16.78, and at the Chicago Citygates Tuesday packages changed hands at $15.49, up $3.26. Gas on Northern Natural Ventura jumped $5.92 to $16.62, and on Michcon, next-day parcels were seen at $13.97, up $4.61. Consumers gas rose $5.76 to $16.47.

Next-day prices also rose in California as the state is faced with rising demand and dangerously low storage. “Due to the slightly colder than normal temperatures in California last week, demand was up and being met with increased storage withdrawals and imports,” said Genscape Inc. “That continues into this week, although weather forecasts are predicting above normal temperatures in the Southwest.

“Demand has increased plus-0.6 Bcf/d to 8.3 Bcf/d from last week’s average of 7.7 Bcf/d. Imports have remained low at plus-0.4 Bcf/d from last week’s average of 4.5 Bcf/d, so it seems that storage withdrawals continue to keep the region ahead of demand with an increase of plus-1.2 Bcf/d to 4.2 Bcf/d from last week’s average of 3.0 Bcf/d.”

Inventories in California are getting thinner by the day, according to Genscape.

“After California’s recent demand strike connected to the colder than normal temperatures that swept across the U.S., storage withdrawals continue to meet the increased demand. On the PGE system, there are two storage facilities, Gill Ranch and Central Valley, which are in critical condition due to over 100% utilization. Gill Ranch has decreased to a scheduled 215 MMCF/d from last week’s 260 MMcf/d.”

Next-day gas at California points added more than $1.00. Gas for delivery at the PG&E Citygates rose $1.09 to $7.76, and at the SoCal Citygates, Tuesday packages were seen at $7.91, up $1.438. SoCal Border gas rose $1.41 to $7.95.

New York futures traders were at a loss to explain the day’s decline. “We are still having very cold weather in the Northeast and we aren’t expected to get out of it until Feb. 20,” said a New York floor trader. “We are having another major snowstorm Wednesday night so I don’t know why we are drifting so low. It’s possible the market is looking ahead to spring, but this is one of the worst winters we’ve had since 1996 as far as cold and snow. Central Park has already had 41 inches of snow. People are using cross-country skis and snowshoes.”

More expansive weather outlooks, however, turned milder over the weekend. WSI Corp. in its six- to 10-day outlook showed above to much above normal temperatures over the western half of the country with below normal temperatures limited to the Mid-Atlantic and portions of the Great Lakes and New England. Monday’s “six-10 day period has trended warmer when compared to Friday’s forecast. Forecast confidence is considered near average standards as models show generally good large-scale model agreement with some embedded technical differences.

“Recent trends in the models support a milder solution across the Lower 48 as models continue to resolve an amplified warm ridge across the central U.S. There are some colder risks to [the] forecast early in the period over the Northeast pending if a developing coastal storm late in the one- to five-day period produces a fresh snow pack over the Northeast in through the Mid-Atlantic states.”

March futures settled 16.8 cents lower last week at $4.775 after a wild ride that took prices as high as $5.737. Risk managers, however, don’t see a long-term threat of higher prices.

“We still feel the explosive rally indicates to us that the recent move is being driven by a short-term weather short squeeze rather than a major fundamental shift in the natural gas market,” said DEVO Capital President Mike DeVooght. “Also putting a damper on the back months is a strong offer by those that would love to lock in a $4.00-plus number (including the basis) so they can untap shut-in wells. On a trade basis, we will continue to hold the balance of the winter short positions. This past week we added to our short positions.”

DeVooght advised trading accounts to hold a short March futures position established earlier at $4.40-4.50. End-users should stand aside, and producers and those with exposure to lower prices should hold short a March position at $4.50-4.60, hold short an initial short position in the April-October strip at $4.20-4.30, and hold short an increased position in the April-October strip at $4.50.

Energy Metro Desk revealed an estimated storage withdrawal of 221 Bcf for the week ended Feb. 7. The estimate was the average of 11 participants surveyed and the range was from 209 Bcf to 238 Bcf.