Physical gas for Wednesday delivery inched lower overall Tuesday as weakness in California and the West countered weather-driven strength at New England, Marcellus and Mid-Atlantic points. At the close of futures trading May had advanced 4.2 cents to $4.739 and June was up by 4.3 cents to $4.758. The expiring May crude oil contract tumbled $2.24 to $102.13/bbl.

Spot prices at New England locations rose as much as a dime as unsettled and turbulent weather was slated to grind through the area and put the squash on any trend to milder temperatures. Forecasters called for temperature drops of close to 15 degrees. “Rain and thunderstorms spreading to the East on Tuesday will put the brakes on the warmup following Easter weekend. After spreading into the Midwest — rattling Chicago, St. Louis and Indianapolis in the process — on Monday, showers and thunderstorms will continue to track to the East and central Gulf coasts Tuesday through Tuesday night,” said AccuWeather.com meteorologist Kristina Pydynowski.

“Odds favor the storminess waiting until later Tuesday to reach the I-95 corridor. Boston and Portland should even remain dry through the daylight hours. It is not out of the question that one or two thunderstorms become strong enough to unleash damaging winds and/or hail from Baltimore and Washington, DC, southward.”

According to Pydynowski, even though “heavy rain is not expected, enough rain could fall to trigger localized flash flooding issues across northern New England where rivers are running high and the ground is saturated from recent rain and melting snow. The rain will end as snow showers in the mountains of northern New England Tuesday night and Wednesday. There may even be enough cold air in place for wet snowflakes to fly Wednesday morning in the higher terrain of New York State and northwestern Pennsylvania.

“The cooldown in the wake of Tuesday’s showers and thunderstorms will be far less dramatic than what was experienced earlier this week, preventing more places from seeing yet another round of wet snow or snow pellets. Across the East, the cooler air will be noticed the most by residents and visitors to the Northeast on Wednesday. In addition to temperatures tumbling, brisk winds will blow and create lower [wind chill] temperatures.”

Boston’s high of 69 degrees Tuesday was expected to drop to 58 Wednesday and rise to 62 by Thursday. The seasonal high in Boston is 58. New York City’s high Tuesday of 71 was expected to take a 13 degree drop to 58 on Wednesday before reaching 64 on Thursday. Philadelphia’s peak of 74 on Tuesday was predicted to drop to 60 on Wednesday and recover to 64 on Thursday. The normal mid-April high in Philadelphia is 67.

Although the shoulder-season weather may seem benign and hardly disruptive, analysts see a slow start to the injection season and the potential for price instabilities down the road.

“The string of lower-than-anticipated injections has triggered a 10% rally in the front of the curve since the start of the month, tempering expectations of a robust start to the restocking season,” said Teri Viswanath, director of commodity strategy, natural gas at BNP Paribas. “This slow start to the injection season and subsequent rise in U.S. natural gas prices underscores the key role that weather will play as a key short-term price determinant.

“Lingering heating demand has delayed the conversion of several of the Eastern storage fields, contributing to the last two lower-than-expected storage reports. And even though most U.S. storage facilities are now reporting net injections, the slow start to restocking this injection season significantly increases the odds of wintertime price spikes ahead.”

At the Algonquin Citygates, Wednesday deliveries added 6 cents to $4.61, and gas at Iroquois Waddington shed 3 cents to $4.86. On Tennessee Zone 6 200 L next-day packages gained 12 cents to $4.76.

Marcellus points firmed. Gas on Millennium added 2 cents to $4.18, and Wednesday parcels on Transco Leidy were unchanged at $3.96. Wednesday deliveries on Tennessee Zone 4 Marcellus rose 4 cents to $3.92.

Gas bound for New York City on Transco Zone 6 gained 9 cents to $4.35, and gas delivered to Tetco M-3 came in at $4.38, up 2 cents.

Solid pricing in the East was offset by weakness on the West Coast. Deliveries to Malin shed 3 cents to $4.63, and gas at the PG&E Citygates was down 8 cents to $5.14. At the SoCal Citygates, quotes were seen at $4.96, down 3 cents, and at the SoCal Border next-day gas changed hands at $4.74, down 7 cents. Gas on El Paso S Mainline was off four cents at $4.80.

The folks at Wunderlich Securities in Houston raised their 2014 natural gas price forecast to account for lean inventories in natural gas, but they also said, “The severe winter experienced in U.S. and Canada did a great job in wiping out inventories of all sorts: petroleum products, natural gas, propane, and even ethane…We believe that 2014 should be another strong year operationally and financially for the sector. As such. we are moving our price deck higher across the board to account for the lower supplies and ample demand.”

Irene Haas in the firm’s equities research department said, “We are raising our 2014 price outlook for WTI from $95.00/bbl to $100.00/bbl, [and] our projection for U.S. natural gas (Henry Hub) from $3.90/MMBtu to $4.36/MMBtu and…At the same time, we are keeping our 2015 U.S. natural gas price assumption at $4.50/MMBtu for now…”

She expects robust pricing this summer to encourage gas storage. “Natural gas withdrawals from storage have been extreme. We entered the April shoulder month with about 826 Bcf in storage versus the five-year average level of 1,814 Bcf for the same period. While there is plenty of dry gas from the Marcellus, the lack of southbound transportation limits the threat this trend might post to prices. We could see increased activity trends with direct connection to the Gulf Coast storage areas such as the Haynesville, the Fayetteville and the Barnett. We expect strong prices all summer as utilities and various end-users compete to replenish inventory.”

In the short term, analysts see some potential weakness before prices resume their advance. “While [Monday’s] lows could offer some brief support, we are leaving open the possibility of a further downdraft into the $4.60-4.70 zone, a price range that could possibly be maintained through this week’s EIA [Energy Information Administration] report given the fact that we don’t expect any bullish shockers out of this Thursday’s EIA data,” said Jim Ritterbusch of Ritterbusch and Associates.

Ritterbusch recommends pursuing the market strictly from the long side. “Following a pause in this year’s bull move that could potentially extend into next week, we will look for a renewed up-phase into new high territory that could potentially carry toward the $5 region in referencing the June contract. Our model remains one in which expected production gains will be insufficient to offset improving demand going forward. Eventually, output will see some upside acceleration when downward trends in gas-directed rigs reverse to the upside and injections will accelerate through much of the summer period. Nonetheless, a plethora of risk will keep values skewed higher, including a potential hot summer, early start to the hurricane season, unplanned nuke downtime, etc.”

In a Tuesday morning report to clients, Addison Armstrong of Tradition Energy said he sees the market “balanc[ing] severely depleted storage levels and expectations of increased demand due to a heavier than normal nuclear power plant maintenance and refueling season against record production levels of gas. But lingering heating load and expectations for a third consecutive below-average storage injection should provide support for gas prices.”