June natural gas is set to open a penny higher Monday morning at $2.11 as traders factor in forecasts of cooler temperatures and see a rangebound market until summer weather patterns become better defined. Overnight oil markets fell.

In its morning 6- to 10-day outlook MDA Weather Services reported that "The forecast over the weekend saw significant cool changes focused on the eastern two-thirds of the US, which comes with a stronger push of high pressure into these areas in the wake of ridging near Alaska (-EPO) [Eastern Pacific Oscillation]. With this, temperatures are now expected to fall below normal from the Midwest to the East, with readings peaking at much below normal levels from early to mid-period in the Midwest.

"While there remains additional cool risk that could average the period in the much below normal category in the Midwest per the GFS [Global Forecast System] model, moderation is forecast late as western ridging breaks down."

MDA admitted that risks to the forecast include moderation late in the period could be slower to evolve, lending cooler risks for the Eastern Half. The South carries cooler risks as well, based on the GFS model.

Risk managers don't see the market going anywhere far anytime soon. "Over the past few weeks, the gas market has been working higher, especially the deferreds," said Mike DeVooght, president of DEVO Capital in a weekend note to clients. "We continue to see a decline in open interest, which indicates that the funds, which have been carrying a large short position for quite some time, are starting to liquidate their positions.

"Natural gas will most likely be in a holding pattern until we get deeper into the summer cooling season. If we get warmer than normal temperatures early in the season, we could move back into the mid-$2 range. On a trading basis, we will continue to stand aside and await further developments."

 DeVooght recommends standing aside the market for now, but should the June-October strip trade up to $2.70, he recommends producers and physical market longs initiate short hedges. The June-October strip, however, settled Friday at $2.296.

 In an early survey of the week's storage report John Sodergreen, editor of Energy Metro Desk reported that a sample of 10 observers resulted in an average 61 Bcf. Last year 101 Bcf was injected and the five-year pace stands at 79 Bcf.

In overnight Globex trading June crude oil fell 51 cents to $44.61/bbl and June RBOB gasoline fell a penny to $1.4896/gallon.