Physical natural gas for weekend and Monday delivery slumped in Friday’s trading as all traders had to do was look at near-term weather forecasts and remember that incremental weekend purchases could be made via electronic media. Three-day deals did not seem necessary.

Several points followed by NGI traded flat, but all other market points fell at least a dime. The NGI National Spot Gas Average fell 16 cents to $1.51, and the East on average was down more than 30 cents. Futures slipped lower after Thursday’s weak EIA storage report, and at the close on Friday, April managed a six-tenths of a cent gain to $1.791 and May also added six-tenths of a penny to $1.873. April crude oil dropped 29 cents to $32.78/bbl.

Forecasts for weekend and Monday temperatures gave gas buyers no cause for alarm. Wunderground.com predicted that Chicago’s Friday high of 38 degrees would rise to 53 Saturday and ease only slightly to 50 on Monday, 10 degrees above normal. New York City was anticipated to see its high Friday of 38 rise to 44 Saturday but jump to 57 on Monday. The normal high in New York City for late February is 44.

Gas at major market centers tumbled, with the East taking the lead. Deliveries to the Chicago Citygate fell 6 cents to $1.71, and gas at Henry Hub was quoted 11 cents lower at $1.66. Deliveries to New York City via Transco Zone 6 skidded 77 cents to $1.13, and gas at the PG&E Citygate changed hands 4 cents lower at $1.86.

Double-digit declines were common. Gas on Dominion South fell 19 cents to 97 cents, and gas on Transco Zone 4 gave up 11 cents to $1.66. Deliveries to El Paso Permian shed 12 cents to $1.45, and gas at Opal retreated 11 cents to $1.44.

Big moves were seen at the Algonquin Citygate for weekend and Monday gas, down $1.32 to $1.59, and gas on Tenn Zone 6 200L fell $1.22 to $1.75. Deliveries to Tenn Zone 5 200L were quoted 68 cents lower at $1.68.

Thursday’s lean storage withdrawal was met with a healthy degree of skepticism. “The EIA reported a -117 draw yesterday, which was 19 Bcf below our expectation (-136), 22 Bcf below the survey average (-139), and 12 Bcf below the lowest number on the street (-128),” said industry consultant Genscape.

“Last week’s stat was revised by 5 Bcf from a -158 to a -163 pull [and] one could argue that the 5 Bcf revision in last week’s stat was “borrowed” from this week, which could have made this week’s draw a -122. But even a -122 would be well below the lowest number on the street and well below our S&D [supply and demand] and pipe scrape models. This week’s stat appears erroneous and it would not be a surprise to see it revised in the near future.”

“The bears have had a good run lately. In addition to this week’s bear stat, the weather forecast remains very mild (we are on track to end the winter more than 450 degree days below normal – around 750 Bcf below normal demand for the winter); production recently hit a new all-time high; and storage is likely to end the winter more than 600 Bcf above average as a result of the previous two points.

“Beleaguered bulls can point to production declines over the last several days, and the fact that Sabine Pass just exported its first LNG export cargo this week. Per Cheniere’s most recent presentation, they expect Train 1 to be fully operational by late April or early May, and train 2 to be fully operational by August. Trains 1 and 2 will consume around 1.3 Bcf/d when they are running at 100%.”

Others point to production declines as also aiding the case for the bulls. “The declines in production are a bullish sign for gas prices, said Jefferies LLC in a report.

“With now two of the top five U.S. gas producers in clear distress, the implications are highly bullish for macro gas,” wrote Jefferies analyst Jonathan D. Wolff. “Our bottoms-up 21-basin U.S. supply model is at 3.2% exit-2016 decline rate, but the potential for further declines is becoming more obvious.”

Tim Evans of Citi Futures Perspective said the 117 Bcf pull reported Thursday “was much smaller than our simple weather-based model’s 145 Bcf forecast, implying some weakening of the underlying supply-demand balance and a bearish shift in the baseline for the weeks ahead.”

Evans forecasts next week’s storage withdrawal report at a mere 35 Bcf, much less than last year’s 204 Bcf and a five-year average of 144 Bcf. By March 11 he anticipates the year-on-five-year surplus at a titanic 765 Bcf.

“The uptrend in the surplus confirms the market is becoming increasingly overstocked on a seasonally adjusted basis, with a corresponding increase in the downward pressure on prices.”

Gas buyers across the PJM footprint should have ample renewable generation to offset weekend gas purchases for power generation. WSI Corp. in its Friday morning report said, “High pressure will promote fair, yet cooler temperatures [Friday] into tomorrow. A clipper type low-pressure system is expected to sweep across the Canadian border Sunday into Monday, producing a period of rain showers and clouds. Total precipitation will range between 0.1-0.25 inches. After a cool start to the period (highs in the 30s-40s), a warming trend this weekend will promote above average temperatures to begin next week (highs in the 50s-60s).

“A southwesterly breeze will promote modest wind gen prospects over the next couple of days as output will slowly rise from 3 GW to 6 GW through Sunday. Flow is expected to become more variable next week, reducing prospects.”

Forecasts for weekend and Monday temperatures gave gas buyers no cause for alarm. Wunderground.com predicted that Chicago’s Friday high of 38 degrees would rise to 53 Saturday and ease only slightly to 50 on Monday, 10 degrees above normal. New York City was anticipated to see its high Friday of 38 rise to 44 Saturday but jump to 57 on Monday. The normal high in New York City for late February is 44.

Gas at major market centers tumbled, with the East taking the lead. Deliveries to the Chicago Citygate fell 6 cents to $1.71, and gas at Henry Hub was quoted 11 cents lower at $1.66. Deliveries to New York City via Transco Zone 6 skidded 77 cents to $1.13, and gas at the PG&E Citygate changed hands 4 cents lower at $1.86.

Double-digit declines were common. Gas on Dominion South fell 19 cents to 97 cents, and gas on Transco Zone 4 gave up 11 cents to $1.66. Deliveries to El Paso Permian shed 12 cents to $1.45, and gas at Opal retreated 11 cents to $1.44.

Big moves were seen at the Algonquin Citygate for weekend and Monday gas, down $1.32 to $1.59, and gas on Tenn Zone 6 200L fell $1.22 to $1.75. Deliveries to Tenn Zone 5 200L were quoted 68 cents lower at $1.68.

Thursday’s lean storage withdrawal was met with a healthy degree of skepticism. “The EIA reported a -117 draw yesterday, which was 19 Bcf below our expectation (-136), 22 Bcf below the survey average (-139), and 12 Bcf below the lowest number on the street (-128),” said industry consultant Genscape.

“Last week’s stat was revised by 5 Bcf from a -158 to a -163 pull [and] one could argue that the 5 Bcf revision in last week’s stat was “borrowed” from this week, which could have made this week’s draw a -122. But even a -122 would be well below the lowest number on the street and well below our S&D [supply and demand] and pipe scrape models. This week’s stat appears erroneous and it would not be a surprise to see it revised in the near future.”

“The bears have had a good run lately. In addition to this week’s bear stat, the weather forecast remains very mild (we are on track to end the winter more than 450 degree days below normal – around 750 Bcf below normal demand for the winter); production recently hit a new all-time high; and storage is likely to end the winter more than 600 Bcf above average as a result of the previous two points.

“Beleaguered bulls can point to production declines over the last several days, and the fact that Sabine Pass just exported its first LNG export cargo this week. Per Cheniere’s most recent presentation, they expect Train 1 to be fully operational by late April or early May, and train 2 to be fully operational by August. Trains 1 and 2 will consume around 1.3 Bcf/d when they are running at 100%.”

Others point to production declines as also aiding the case for the bulls. “The declines in production are a bullish sign for gas prices, said Jefferies LLC in a report.

“With now two of the top five U.S. gas producers in clear distress, the implications are highly bullish for macro gas,” wrote Jefferies analyst Jonathan D. Wolff. “Our bottoms-up 21-basin U.S. supply model is at 3.2% exit-2016 decline rate, but the potential for further declines is becoming more obvious.”

Tim Evans of Citi Futures Perspective said the 117 Bcf pull reported Thursday “was much smaller than our simple weather-based model’s 145 Bcf forecast, implying some weakening of the underlying supply-demand balance and a bearish shift in the baseline for the weeks ahead.”

Evans forecasts next week’s storage withdrawal report at a mere 35 Bcf, much less than last year’s 204 Bcf and a five-year average of 144 Bcf. By March 11 he anticipates the year-on-five-year surplus at a titanic 765 Bcf.

“The uptrend in the surplus confirms the market is becoming increasingly overstocked on a seasonally adjusted basis, with a corresponding increase in the downward pressure on prices.”

Gas buyers across the PJM footprint should have ample renewable generation to offset weekend gas purchases for power generation. WSI Corp. in its Friday morning report said, “High pressure will promote fair, yet cooler temperatures [Friday] into tomorrow. A clipper type low-pressure system is expected to sweep across the Canadian border Sunday into Monday, producing a period of rain showers and clouds. Total precipitation will range between 0.1-0.25 inches. After a cool start to the period (highs in the 30s-40s), a warming trend this weekend will promote above average temperatures to begin next week (highs in the 50s-60s).

“A southwesterly breeze will promote modest wind gen prospects over the next couple of days as output will slowly rise from 3 GW to 6 GW through Sunday. Flow is expected to become more variable next week, reducing prospects.”