Backed by the news that winter will continue for six weeks after Punxsutawney Phil saw his shadow Tuesday morning, cash market traders followed the script from Monday where points across the United States posted gains with the exceptions of a few in the Northeast, which continued to decline.

While the declines in the Northeast were not as large as they were on Monday, points like Transco Zone 6 New York, which dropped by more than $1.50 on Tuesday, declined by another 40-plus cents on Tuesday, according to IntercontinentalExchange (ICE) indices. Iroquois Zone 2, which dropped nearly $1.60 on Monday, fell almost 20 cents on Tuesday, according to ICE.

Some market watchers were of the opinion that a temporary warm-up in the area was responsible for prices in the region going counter to the rest of the country. “Prices have been pretty weak at some of the larger northeastern pricing points,” a New York broker said. “I’m actually scratching my head a bit on this one because I don’t really understand the enthusiasm behind the weakness. I’m hearing it is because of some warmer temperatures, but those are not expected to stick around very long at all.”

Elsewhere, prices were up pretty evenly from the Gulf Coast to the Midcontinent through to the West Coast with most gains coming in between 8 cents and 16 cents.

It appears that the nation’s first real winter in more than five years will stick around for a while if Punxsutawney Phil is to be believed. The Pennsylvania groundhog saw his shadow Tuesday morning, signaling that winter will continue for another six weeks.

Natural gas futures traders don’t appear to be big fans of the famous rodent as values declined Tuesday morning. After reaching an early morning high of $5.521, March natural gas futures retreated to a low of $5.378 just after 9:30 a.m. EST. However, the prompt-month contract ended up closing the regular session at $5.454, up 2 cents from Monday’s finish (see related story).

According to, chilly temperatures are expected to hover over a majority of the United States in the near term as a wintry mix of snow and ice is expected to impact the Mid-Atlantic and parts of the Northeast.

In the National Weather Service’s latest six- to 10-day and eight- to 14-day forecasts covering Feb. 8-12 and 10-16, the entire eastern third of the country — and Texas and New Mexico — are expected to see below-normal temperatures, while the Northwest through Montana and northern Wyoming experiences above-normal conditions and the remainder of the country sees normal readings.

According to Citi Futures Perspective analyst Tim Evans, natural gas values could be priming for a return to the upside. “Natural gas [futures] is jumping back to the upside as it turns out winter isn’t over after all. While the season has reached its midpoint and the temperature norms will begin walking forward in the weeks ahead, there’s enough cold in the current outlook (more than was forecast on Friday), in order to turn the futures market back to the upside.”

Evans said he wasn’t sure whether there would be enough new heating demand to spark an extended rally or not, but he noted that the push would be enough to keep prices in the “intermediate-term range.” If the current cold temperature outlook holds up, the analyst said near-term potential could take futures to $5.750.

Looking at the storage report for the week ending Jan. 29, Evans said that while he does not expect a return to the 200 Bcf-plus draws of a few weeks ago, he also does not expect a double-digit draw like the one recorded for the week ending Jan. 22.

The analyst’s early prediction is for a 135 Bcf draw, which would be smaller than both last year’s date-adjusted 194 Bcf pull and the five-year average pull for the week of 177 Bcf.

©Copyright 2010Intelligence Press Inc. All rights reserved. The preceding news reportmay not be republished or redistributed, in whole or in part, in anyform, without prior written consent of Intelligence Press, Inc.