April natural gas is set to open 5 cents lower Wednesday morning at $2.80 as traders see minimal market impact from current weather forecasts and technicians see a deflationary price environment. Overnight oil markets fell.

In spite of Tuesday’s double-digit advance, forecasters at Natgasweather.com rate the level of natural gas demand as low to moderate for the next seven days and categorize any weather threat as low. “Temperatures will cool several degrees over most U.S. regions [Wednesday] after being warmer than normal for the past several. Widespread showers are expected over Texas and the east-central U.S. as weather systems track out of the Southwest and Mexico, providing several degrees of cooling.

“A sharp cold front has also swept through the Northeast, resulting in overnight lows dropping into the teens and 20s, although the truly cold air will fail to push any farther south. A stronger cold blast will follow late Friday into early next week over the Midwest and Northeast, driving a period of stronger heating demand, although with potential flaws that need close watching as cold air struggles to again push south of the Great Lakes. The western U.S. will remain warmer than normal, although there will be showers into the Northwest and Southwest at times.”

The National Weather Service (NWS) calculates greater heating demand for the Northeast. For the week ended March 21, NWS says New England will see 221 heating degree days (HDD), or 19 more than normal, and the Mid-Atlantic will endure 196 HDD or 14 more than its seasonal tally. The greater Midwest from Ohio to Wisconsin is expected to see 168 HDD, or 22 fewer than normal. The U.S. as a whole is forecast to see total HDDs, 18% fewer than normal.

Analysts see conventional seasonal analysis for natural gas prices as losing relevance. Walter Zimmermann of United ICAP points out that the average seasonal low for natural gas prices is Feb. 11, but “here we are a full month later and there is still no sign of any traction to the upside. There were only three years when the seasonal low occurred later than today. For those three years the average seasonal rebound was only a 39% gain in spot contract value.

“Given the recent deflation driven dumps in the NGLs and LNG the risk for natgas is not simply congestion instead of a seasonal rebound. The risk is a price dump,” he said in a weekly letter to clients.

In overnight Globex trading April crude oil fell $1.05 to $42.41/bbl and April RBOB gasoline dropped a penny to $1.7187/gal.