Physical natural gas for Wednesday delivery on balance was unchanged Tuesday as demand-driven weakness in the Northeast and Appalachia was offset by price gains in the Rockies and California. The NGI National Spot Gas Average came up flat at $2.79.

Forecast near-term demand drops from 20% to 25% from New England to the Mid-Atlantic pulled the plug on eastern prompt gas, but forecast western heat lifted California and Rocky Mountain quotes. Futures failed to break through $3 resistance as longer-term weather outlooks offered little market support, and at the close September had eased 2.3 cents to $2.939, while October had given up 2.4 cents to $2.968. September crude oil expired at $47.64/bbl, up 27 cents.

Sinking forecasts for energy demand gave gas buyers for power generation little incentive to make incremental purchases. ISO New England predicted Tuesday’s peak load of 22,170 MW would fall to 19,120 MW Wednesday and 17,910 MW by Thursday.

New York and the broad PJM Interconnection grid followed suit. The New York ISO forecast peak load Tuesday of 28,025 would decline to 23,730 MW Wednesday before reaching 21,157 MW Thursday. PJM estimated peak load Tuesday of 52,982 MW would drop to 44,657 MW Wednesday, and 40,686 MW Thursday.

Gas at the Algonquin Citygate fell 54 cents to $2.67 and deliveries to Tetco M-3 shed 15 cents to $1.87. Gas on Dominion South skidded 4 cents to $1.81 and gas bound for New York City on Transco Zone 6 plunged 68 cents to $2.47.

Gas at the Chicago Citygate added 6 cents to $2.94 and parcels at the Henry Hub were quoted at $3.01, up 3 cents. Transco Zone 4 changed hands at $2.99, up 6 cents and deliveries to Panhandle Eastern changed hands 7 cents higher at $2.64.

Gas at West Coast and Rockies points firmed as the West was expected to see toasty temperatures going forward. Deliveries to Opal came in 16 cents higher at $2.73, and El Paso S Mainline added 14 cents to $2.92. PG&E Citygate rose 8 cents to $3.36 and gas priced at the SoCal Border Average gained 14 cents to $2.90.

“Temperatures over the interior valleys of California will reach the triple digits this weekend, especially on Sunday,” said meteorologist Maggie Samuhel. “A light flow of air from the interior to the coast will also push temperatures upward. Highs near 90 are forecast for downtown in Los Angeles this weekend, and for the remainder of August, above-average temperatures are likely to continue over the western U.S. in general.”

She explained that the jet stream will be displaced well to the north over into western and central Canada for much of the balance of August, and normally temperatures trend downward a bit during late August. However, temperatures during the period are likely to run 3 to 8 degrees above average, according to Samuhel.

Traders suspect the market may be confined to a narrow range leading into Labor Day. “Today’s early strength failed to hold since there wasn’t significant shifts in the updated weekend temperature forecasts to support much buying interest,” said Jim Ritterbusch of Ritterbusch and Associates in closing comments to clients. “Consequently, our anticipated staunch resistance at the $3 level was validated as the market fell back down to about the middle of Friday’s range as the session progressed.

“This market continues to be buffeted by the bearish temperature views and the bullish influence of a sharply downsized supply surplus. With the cooling degree day season winding down with the approach of Labor Day, the market could remain trapped in a relatively narrow range that we have defined as about $2.85 on downside and $3.11 on the upside in referencing nearby futures. We will expect some further consolidation tomorrow mainly within today’s trading range with Thursday’s storage report likely determining how the complex finishes this week. But for now, we are maintaining a neutral or sideline trading stance.”

In its 2 p.m. report the National Hurricane Center (NHC) said satellite images indicate that an area of low pressure over the Yucatan Peninsula, associated with the remnants of Harvey, has become better defined during the day. Environmental conditions are conducive for development when the system moves over the Bay of Campeche tonight, and a tropical depression is expected to form over the southwestern Gulf of Mexico on Wednesday or Thursday, and move in the general direction of the Texas coast on Friday. NHC put the probability of tropical storm formation in the next 5 days “near 100%.”

NHC also said any development of disorganized shower and thunderstorm activity associated with a broad trough of low pressure near the northwestern Bahamas should be slow to occur while it moves northwestward or northward near Florida and the adjacent waters.

“Environmental conditions could become a little more conducive for tropical or subtropical development by the weekend when the system begins to move northeastward over the western Atlantic,” NHC said, pegging the probability of tropical storm formation in the next five days at 30%.