Natural gas futures rallied early Friday, surpassing the coveted $3.000 mark as an already frigid forecast shifted notably colder overnight. However, the gains failed to hold as the long-range outlook showed signs of the deep freeze fading later this month.

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The March Nymex gas futures contract closed the week at $2.863, down 7.2 cents from Thursday’s close. April slipped 4.8 cents to $2.841.

Cash prices strengthened, however, as the polar plunge descended into the Midwest before slowly crawling toward the East Coast. NGI’s Spot Gas National Avg. climbed 76.0 cents to $4.010.

Though he doesn’t have the best track record, Punxsutawny Phil’s prediction of six more weeks of winter may have some legs. NatGasWeather said moderate demand over the past week began increasing...