It was a contest Tuesday to see whether natural gas cash or futures would take the crown of most lethargic. Declines in Appalachia, the Northeast, and California were met head on with firm pricing in Texas, Louisiana, and steady quotes in the Midwest and Midcontinent. The NGI National Spot Gas Average fell a penny to $2.66.

At first blush it looked as though futures bulls might be treated to a forecast of cooler temperatures, but a closer look revealed that whatever cooling might prevail in eastern and Midwest markets was likely to be offset by heat in the West and near-record heat in California. At the close November had added 1.6 cents to $2.962 and December had gained 2.0 cents to $3.128. November crude oil added a penny to $51.88/bbl.

In southern California next-day prices eased somewhat as temperatures were forecast to drop going into the end of the week and next-day peak power loads and prices both receded. forecast that Los Angeles' high Tuesday of 96 degrees would slide to 86 by Wednesday and fall to 79 Thursday, one degree above normal. Burbank's high of 94 was predicted to drop to 88 Wednesday and 80 by Thursday, also one degree above normal.

Gas at the SoCal Citygate fell 31 cents to $4.99 after posting a meteoric gain Monday of $2.29 to $5.30. Gas priced at the SoCal Border Average shed a nickel to $2.93. Kern River came in at $2.69 up 8 cents and deliveries to the Cheyenne Hub were quoted at $2.60, up 4 cents.

CAISO forecast that Tuesday's peak load of 33,921 MW would ease to 32,219 MW Wednesday.

Intercontinental Exchange reported that on-peak power at SP-15 Wednesday fell $1.01 to $55.56/MWh

The National Weather Service in Los Angeles said, "Light offshore flow will bring above normal temperatures through [Tuesday]. Patchy fog and low clouds return to the coast Thursday and Friday as temperatures cool to near normal late in the week. Temperatures increase again this weekend and into the following week as another offshore wind event develops over the region."

Elsewhere the Northeast was hit with double-digit declines of its own as next-day power prices slipped. Intercontinental Exchange reported on peak power at the ISO New England's Massachusetts Hub fell $3.23 to $36.57/MWh and on-peak Wednesday power at the PJM West terminal dropped $1.61 to $30.28/MWh.

Gas at the Algonquin Citygate gave up 30 cents to $2.96 and deliveries to Dominion South fell 13 cents to $1.15. Packages on Tetco M-3 Delivery fell 20 cents to $1.49 and gas on its way to New York City via Transco Zone 6 shed 6 cents to $2.79.

Deliveries to the Chicago Citygate fell 2 cents to $2.79 and gas at the Henry Hub rose 2 cents to $2.89. Gas on El Paso Permian added 3 cents to $2.52 and gas priced at Northern Natural Demarcation changed hands a penny higher at $2.71.

Despite the price slide south of $3, traders are maintaining a bullish posture. "This market was unable to maintain early price gains largely because weekend updates to the short term temperature views failed to offer significant changes from Friday," said Jim Ritterbusch of Ritterbusch and Associates in closing comments Tuesday.

"Much of the southeast quadrant of the U.S. is expected to shift in a cool direction next week while key consuming regions elsewhere are expected to see limited [heating degree day] accumulation. Nonetheless, we still look for near term price gravitation toward the $3 area even allowing for a bearish surprise within Thursday's [Energy Information Administration] release. We are expecting a build of about 63 Bcf that would imply further expansion in the small supply deficit versus five-year averages of about 15 Bcf.

"But we are also allowing for the possibility that the supply shortfall could be erased by next month should mild temperature trends be extended into next month across the northern half of the U.S. Overall, we are maintaining a bullish stance for now and would suggest holding any long positions anywhere along the curve. But we have suggested lifting stop protection to the 2.88 level close only in referencing nearby futures."

Overnight weather models cooled. "The forecast sees a modest change in the cooler direction in this period, with this being a result of model trends in further deepening a trough over the Eastern Half in the mid to late period," said MDA Weather Services in its morning six- to 10-day outlook.

"There remains still cooler risks as well based on the GFS Ensembles and operational guidance from both the GFS and the Euro, but the Pacific origins of a cooler air mass left behind the trough has the forecast only fading the intensity of the composite's broad warmth with a late period round of normals into the Midwest. The West features a small warm adjustment, with southern California in particular having near record heat."