Despite a modest recovery in flows to U.S. export terminals, cooler forecast trends over the weekend pressured natural gas futures lower in early trading Monday. The August Nymex contract was down 3.1 cents to $1.777/MMBtu at around 8:40 a.m. ET.

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The temperature outlook shifted in the cooler direction over the weekend, with a loss of expected heat for next week “outweighing a minor hotter change” for the current week, according to Bespoke Weather Services.

“The bulk of the cooler changes come in the central U.S., running from the Plains over into the Midwest,” Bespoke said. “This is the region where models have had the largest hot bias over the last several weeks. Total demand remains forecast to be above normal for the 15-day period as a whole, but not by much, as the intensity of the pattern has fallen well off levels seen for most of this month to date.”

The forecaster said it’s still expecting a hotter-than-normal August but cautioned that projections through the first third of the month do not show any “risks for strong heat.”

Normal gas-weighted degree day levels “begin to decline after the first few days of August, so it is likely that we have seen peak heat on the national level, in absolute terms,” Bespoke said.

Meanwhile, Hanna, downgraded to a tropical depression as of early Monday, made landfall as a hurricane over South Texas Saturday afternoon.

In terms of supply, analysts at Genscape Inc. observed no impacts to Gulf of Mexico natural gas production from the storm.

“Production has stayed consistent around 88 Bcf/d since last Thursday,” the firm said. 

Storm activity in the Gulf has helped lead to milder temperatures through the country’s midsection, including in Texas, analysts at EBW Analytics Group said.

“This could undercut cash market demand and create downward pressure on the August contract,” the EBW analysts said. “With the August contract closing just below a critical resistance point at $1.81 Friday, however, quant funds and bulls may not yet be ready to give up on their efforts to push futures higher, especially with August options expiring tomorrow.”

On the exports front, liquefied natural gas (LNG) feed gas demand has been holding steady at 3.0 Bcf/d, according to Genscape.

This past Friday feed gas demand dropped close to 450 MMcf/d, from 3.30 to 2.85 Bcf/d amid a “significant decline” in deliveries to Sabine Pass, Genscape analyst Preston Fussee-Durham said.

“Over the weekend, demand recovered slightly, ranging from 3.0-3.1 Bcf/d, roughly 100 MMcf/d less than the month-to-date average of 3.18 Bcf/d,” Fussee-Durham said. “For today’s gas day, feed gas deliveries from interstate pipelines to LNG facilities remains relatively unchanged at 3.0 Bcf/d.”

September crude oil futures were up 25 cents to $41.54/bbl at around 8:40 a.m. ET, while August RBOB gasoline was off fractionally to $1.2761/gal.