Physical natural gas for Wednesday delivery careened lower in Tuesday’s trading as weather-driven projections, particularly in eastern markets, of sharply reduced energy demand pulled the plug on next-day pricing. Only 3 points followed by NGI made it out of the loss column, and the NGI National Spot Gas Average plunged 18 cents to $2.65.

Futures traders took a somewhat longer term view, but not by much. Forecasters called for moderation to start setting in by the weekend, and at the close July had fallen 5.8 cents to $2.966 and August was lower by 6.5 cents to $2.989. July crude oil added 38 cents to $46.46/bbl.

Much lower forecast power loads along the eastern electric grids were enough to send next-day quotes tumbling. ISO New England forecast Tuesday’s peak load of 22,750 MW would fall to 17,250 MW Wednesday and 15,750 MW Thursday. The New York ISO predicted peak load Tuesday of 27,802 MW would drop to 22,615 MW Wednesday and fall further to 20,388 MW Thursday. The PJM Interconnection expected Tuesday peak load of 53,268 MW to recede to 43,119 MW Wednesday and land at 37,692 MW Thursday.

Eastern market points were hit hard. Gas at the Algonquin Citygate shed $1.14 to $2.14, and deliveries to Iroquois Waddington fell 76 cents to $2.33. Gas priced on Tennessee Zone 6 200 L gave up $1.06 to $2.21.

Gas on Tetco M-3 Delivery fell 23 cents to $2.03 and gas headed for New York City on Transco Zone 6 tumbled 90 cents to $2.19.

Other trading centers fell less as weather forecasts called for high temperatures to remain in the 90s. Deliveries to the Chicago Citygate dropped 8 cents to $2.85, and gas at the Henry Hub changed hands 7 cents lower at $3.01. Gas on NGPL Midcontinent fell 11 cents to $2.66 and gas on Transwestern was quoted at $2.48, down 9 cents.

Kern Receipts fell 12 cents to $2.49, and gas priced at the SoCal Border Average dropped 4 cents to $2.60.

Forecast temperatures in the East were anticipated to drop, but elsewhere 90 degree readings ruled the roost.

Wunderground forecast New York City’s 98 high on Tuesday would free fall to 79 Wednesday and 73 by Thursday, 5 degrees below normal. Chicago on the other hand was expected to see its Tuesday high of 89 rise to 92 Wednesday and 93 by Thursday, 14 degrees above normal. Dallas’ Tuesday high of 92 was seen rising to 93 Wednesday and 95 by Thursday, 7 degrees above normal.

Futures traded as high as $3.065 overnight but opened about flat Tuesday morning at $3.02 as forecasts now call for current hot weather patterns to lose some of their rigor by the end of the week.

Weather forecasters see a pattern of near term warmth followed by cooling. “[A] fairly hot pattern will dominate east of the Rockies this week as strong high pressure sets up overhead,” said Natgasweather.com in a noon update. “With highs of upper 80s to lower 90s reaching as far north as Chicago and NYC, natgas demand will be quite strong. This will be exacerbated by hot conditions over Texas where highs will reach the mid 90s to locally 100s. If it wasn’t for the slightly cooler Southeast, demand would be considered impressive for the week.

“Over the West, a strong late season weather system continues to bring valley rains and mountain snows, while also dropping temperatures 10-25°F below normal. Late in the week, modest cooling will briefly sweep across the Northeast, while most of the rest of the country experiences warm to hot conditions with relatively strong demand for cooling ongoing. Late this coming weekend is when a fast-moving weather system over the Midwest will weaken the upper ridge and advance into the east-central US and where we see cooler trends since last week.”

Analysts see a market not ready for prime time. “[Monday’s] early rally fell short of last week’s highs and the subsequent pullback suggests a market not yet poised for a sustainable price advance,” said Jim Ritterbusch in closing comments Monday. “Weekend updates to the weather forecasts as well as today’s adjustments continue to offer a mixed bag with this week’s hot Midwest temperatures offset by an expected late week moderation across the mid-continent and elsewhere.

“Until Thursday’s weekly storage report is released, some further price consolidation is likely with the range bounded by about $2.97 on the down side and today’s highs on the upside. For now, we suggest holding any long positions as we still see high probability of an advance up into the $3.20-3.25 zone per nearby futures,” he added. “While increasing expectations for a lift in production could limit upside price possibilities, this factor could easily be negated by the first sustainable broad based hot spell. We have suggested raising stop protection to below the $2.97 level on a close only basis in referencing July futures. We are also keeping a hold on long fall 17-short winter 18 bull spreads.”