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Following the previous Friday’s sizeable drops, the market was definitely stronger Monday but remained a bit soft for the most part. Although warmer temperatures are forecast for Tuesday in some sections of the Midwest, stormy weather is expected to cool most of the region by midweek, and although it will remain generally hot, some parts of the South can also expect a slight dip in mercury levels.

Despite a mini-heat wave in the Midwest proving to be short-lived, the cash market found enough support from the previous day’s futures spike and remaining high temperatures in much of the East to realize further gains at nearly all points Friday.

Despite modestly weaker futures guidance (down 2.6 cents on the previous Friday), the cash market recovered to a large extent Monday from major softness late last week. Gains highly dominated numbers that seldom varied more than a few pennies up or down from unchanged.

Buoyed by a new gas processing plant and 10 Marcellus Shale wells drilled in the first quarter, Rex Energy Corp. is increasing its capital budget by $26.7 million for the year to support increased drilling activities.

It was no surprise when cash market weakness increased greatly Friday. Not only was there the previous day’s futures drop of 31.6 cents as a depressant, but generally moderate weather forecasts in most areas and the weekend factor of declining industrial load played a part.

It’s well documented by now that due to low natural gas prices a number of producers and oilfield service companies have been switching drilling efforts and asset buildup from the primarily dry gas Haynesville to “wetter” [that is, richer in crude oil and natural gas liquids (NGL)] plays such as the Eagle Ford and Marcellus. But quite a few in the industry see Haynesville as remaining a strong shale resource and eventually strengthening. It may take a few years, but many expect gas prices to eventually begin making up for ground lost to the soaring crude market.

Natural gas supply and demand set new records in 2010, while regional changes in production — including that from the nation’s fast-growing shale plays — altered the industry landscape, according to a state of the markets report issued Thursday by FERC’s Office of Enforcement.

The cash market regained the price ground lost on the previous day and more Wednesday as a decline of heating load in the South proved to be less than expected and the lower Northeast saw a substantial reversal of prior warming trends. Spot gas also had fairly strong support from Tuesday’s May futures rise of 12.4 cents.

Florida Gas Transmission ended Wednesday an Overage Alert Day for market-area customers that had been in effect for the previous two days.