Gas for Wednesday delivery was content to stay home Tuesday as most points moved just a few pennies from unchanged.

Modest strength in the Midcontinent and South Texas was not enough to offset broad but small losses in California, the Midwest and East. The NGI National Spot Gas Average fell 2 cents to $2.10. Futures managed to inch higher with the July contract eking out a new high of $2.486. At the close July had risen eight-tenths of a cent to $2.474 and August had gained 2.0 cents to $2.557. July crude oil gained 67 cents to climb back above $50 at $50.36/bbl.

Marcellus points continued to scratch out small gains against downstream market points along the REX Zone 3 Expansion. Marcellus points remained firm while Indiana and Illinois interconnects weakened. Gas on Dominion South added a penny to $1.64, and deliveries to Tennessee Zone 4 Marcellus gained a couple of pennies to $1.52. Next-day gas on Transco-Leidy Line added a stout 6 cents to $1.50.

Downstream locations on the REX Zone 3 Expansion were steady to weak. Parcels at the NGPL interconnect at Moultrie County, IL, fell a penny to $2.19, and gas at the Douglas County, IL, junction with Trunkline was seen steady at $2.20. Gas on ANR at Shelby County, IN, was also flat at $2.20.

Major Hubs were mostly lower. Gas on Transco Zone 6 NY shed 18 cents to $1.71, and deliveries to the Chicago Citygate were unchanged at $2.23. Gas at the Henry Hub was quoted at $2.28, down 4 cents, and packages at the SoCal Citygate fell 3 cents to $2.36.

Tropical Storm Colin is having its market impact but not in the traditional sense of shut-in or lost Gulf of Mexico production. Colin was in the eastern Gulf of Mexico Tuesday morning but was headed to the Northeast at 33 mph. It was holding 50 mph winds but was expected to significantly lower power demand as it crossed the Carolinas.

Colin is bringing heavy rainfall to Florida and South Georgia, [and] “Florida Governor Rick Scott declared a state of emergency amidst fears of flash flooding throughout the state, industry consultant Genscape said in a report. “Georgia and South Carolina are currently experiencing heavy rainfall as well. Tropical Storm Colin is expected to make its way out to sea by Wednesday but not before bringing more rainfall to the Carolinas.

“On Monday, demand held reasonably strong against the seven-day average of 4.27 Bcf/d slating 4.13 Bcf/d. However, nominations look to be severely impacted going into [Tuesday] as of the Timely cycle, reported demand nominations for June 7th are 2.9 Bcf/d with nominations to power plants making up the vast majority of the drop. Nominations in Georgia and South Carolina appear unaffected, with both states near their seven- day averages of 2.1 and 0.52 Bcf/d respectively.”

Next-day power prices also weakened at major market points. Intercontinental Exchange reported that on-peak power for Wednesday at the Indiana Hub dropped $1.82 to $27.04/MWh and on-peak Wednesday power at NEPOOL fell $2.80 to $21.31/MWh. On-peak next-day power at PJM West skidded $5.35 to $26.37/MWh.

Weather models overnight were largely unchanged. Harrison NY- based Bespoke Weather Services said, “[W]eather model guidance continued to be mixed, though we still see enough long-range signs to expect a cooler end to June despite forecast heat in the eight-15 day timeframe across a couple different parts of the country.

Unchanged was all some traders needed as the market looked “to be consolidating recent gains amid some light profit taking as the temperature outlook moderated from a day ago, subtracting some likely power sector demand related to air-conditioning loads,” said Tim Evans of Citi Futures Perspective in a Tuesday morning report to clients. “Tropical Storm Colin also knocked out power across northern Florida, also reducing power demand for now. Overall, we think the demand and storage outlook remains supportive for the market, but are concerned that the price recovery may have run a bit beyond the current fundamentals, leaving natural gas vulnerable to a downward correction to perhaps the $2.20-2.25 level.”

“Overnight forecasts across the Midwest and South warmed slightly, while forecasts across the entire East Coast gradually cooled as models focused on more trough action over the western Atlantic in the eight-13 day timeframe. The result appears to be a relative net neutral for the natural gas market, though the introduction of some of the eastern trough action will likely limit how far prices are able to advance from here already being in overbought territory,” Bespoke said.

Traders see the temperature outlook as the primary short-term driver. “We look for the hot temps that will be entering the Midcontinent in force later this week to remain as the key source of support with Thursday’s storage data having only minor price impact,” said Jim Ritterbusch of Ritterbusch and Associates in closing comments Monday.

“The contraction in the surplus against average levels should prove relatively small, but focus has already shifted beyond this week’s report and toward a couple of EIA releases later in the month that will be showing some sharply downsized supply builds. Meanwhile, structure continues to strengthen as the physical market responds to the warmer temps. But while we have considered bull spreads recently as a conservative approach to the long side, we are hesitant to chase these trades at current levels.”