Physical natural gas for delivery Wednesday followed the cue from the screen and traded lower Tuesday.

A strong overall showing in the Northeast was unable to counter weakness in California and the Rockies, and the NGI National Spot Gas Average retreated 4 cents to $2.20. Points in the East averaged gains of about a dime.

Futures traders counting on resumed market strength off Monday’s weather forecast-induced advance were sorely disappointed as forecasts once again flip-flopped and traders were looking at less cold and lower demand than previously anticipated. At the close, March was down 4.2 cents to $2.098 and April dropped 4.0 cents to $2.149. March crude oil continued its losing ways giving up $1.75 to $27.94/bbl.

For the most part, next-day gas in New England concentrated on a soft power market as temperatures along the Eastern Seaboard were seen fluctuating around seasonal norms. Intercontinental Exchange reported that on-peak Wednesday power at ISO New England’s Massachusetts Hub shed $4.95 to $41.53/MWh and next-day power at New York ISO’s Zone A delivery point (western New York) was down $9.64 to $21.00/MWh. On-peak power at the PJM West terminal rose 13 cents to $35.54/MWh.

Next-day gas in New England fell, although spot gas in the Mid-Atlantic rose. Gas at the Algonquin Citygate fell $1.09 to $4.54 on light volume, as did gas on Tenn Zone 6 200L, which dropped $1.19 to $4.41. Packages on Iroquois, Waddington were seen 10 cents higher at $2.70.

Farther south, prices advanced by double digits. Gas on Texas Eastern M-3, Delivery changed hands 39 cents higher to $2.24, and gas headed to New York City on Transco Zone 6 jumped 56 cents to $3.46.

New England may have seen the last of falling spot quotes for a while as observers see the highest demand of the season approaching. “Season-to-date demand highs are likely to be established this week in New England and Appalachia,” said industry consultant Genscape. It said that its weather models “once again shifted colder overnight. Population-weighted HDDs for New England are now forecast to reach 59.1 HDDs by Saturday, about 14 HDDs above normal. Appalachia-region population weighted HDDs are also forecast to peak by Saturday, reaching 52.7 HDDs versus the norm of 30.7 HDDs.

“If realized, these will be the coldest temperatures so far this winter. Genscape demand forecasts for New England were revised upward to now peak Friday just shy of 4.1 Bcf/d (about 0.5 Bcf/d above today). Appalachia was also revised up to potentially crest the 22 Bcf/d mark by Friday.

“The Arctic air mass generating these conditions could reach as far south as northern Georgia and South Carolina, possibly lifting Southeast/Mid-Atlantic demand above 23 Bcf/d.”

Prices at major hubs slumped. Gas at the Chicago Citygate fell 4 cents to $2.23, and parcels at the Henry Hub fell a nickel also to $2.17. Gas at Opal was seen 9 cents lower at $1.96, and gas at the SoCal Citygate was quoted 7 cents lower at $2.22.

Analysts aren’t buying the notion that a weather-driven price rally has much to stand on so late in the heating cycle. “[Tuesday’s] price pullback should not come as a surprise since yesterday’s sharp weather-induced rally appeared unsustainable within this advanced stage of the heavy usage cycle and the fact that production is still not showing much of a response to the recent accelerated plunge in oil and gas rig counts,” said Jim Ritterbusch of Ritterbusch and Associates.

“Yesterday’s strength appeared to be a discounting process focused mainly on a major cold spell that has already begun across the upper Midcontinent and one that is apt to extend further south into key producing regions. This possibility of well freeze offs offered an accelerant to yesterday’s advance, but we will further note that a sizable storage overhang that could be boosted by as much as 75 Bcf on Thursday will act as a major cushion in limiting upside price follow-through.”

Overnight, longer-term weather models oscillated to the warmer side and forecasters see less heating load. WSI Corp. in its Tuesday morning report said, “[Tuesday’s] six-10 day forecast is for residual below-average temperatures over the East and much above conditions over the western and central U.S. Today’s forecast is quicker to erode the cold over the East and warmer over the southwestern and central U.S. CONUS GWHDDs dropped 10.6 and are now forecast to be 131.8 for the period. Forecast confidence is average at best today as models are in reasonably good agreement with a moderating trend and eventually a pattern shift by the end of the period. However, there are plenty of technical differences and inherent uncertainty during transitional periods.

“Even with the upward revisions, arctic air can be stubborn to erode and supports a risk back to the colder side over the Northeast and much of the East early in the period.”

Very near term heating loads are expected to remain stout. The National Weather Service for the week ending Feb. 13 predicts New England will see 269 heating degree days (HDD) or four fewer than normal. The Mid-Atlantic is expected to see 259 HDD or five more than normal, and the greater Midwest from Ohio to Wisconsin will see 291 HDD, or 15 more than its normal tally.