December natural gas was set to open about 4 cents higher Friday at around $3.09 as one of the major weather models turned cooler overnight in its outlook for a pair of weather systems expected to boost heating demand over the next two weeks. noted "colder trends in the overnight weather data, especially the European weather model in regards to a weather system over the northeastern U.S. next week, and also another one over the east-central U.S. Nov. 27-28.

"...We essentially see the data as being cold enough to continue increasing deficits in supplies, and with the European trending colder over the past 24 hours, the markets could be starting to realize the pattern should be considered at least somewhat bullish."

Bespoke Weather Services said in a morning update that despite adding "a few medium-range gas-weighted degree days (GWDD) that are clearly supporting the natural gas market this morning" it still sees "sufficient long-range GWDD losses to limit significant upside through the day.”

Bespoke’s 13-15 day outlook on the Global Ensemble Forecast System "was one of the most bearish we have seen in a while,” and even though the European ensembles "show more bullish risks now,” they don’t show enough to “significantly rally this market."

The early morning gains Friday followed a tepid reaction to Thursday's Energy Information Administration storage report, which showed the season's first withdrawal at -18 Bcf, slightly tighter than market expectations. The withdrawal also widened the year-on-five-year deficit.

"For the first time since 2014 U.S. natural gas inventories will enter winter below the five-year average," Barclays Capital analyst Nicholas Potter said in recent note. "Although the development should help support natural gas prices, record gas production growth will likely counterbalance the market from getting overly bullish.

"We forecast 2017 production exit rates to hit 75.4 Bcf/d up from 70.4 Bcf/d in December 2016,” Potter said. November-to-March “production should average 75.6 Bcf/d up from just 70.4 Bcf/d last year."

Potter said the growth is coming from the Marcellus, Utica and Haynesville shales, as well as from associated gas out of the Permian Basin.

"Assuming normal temperatures, we see the market adequately supplied between storage levels, which were just 2% below the five-year average at the end of October, along with increasing production," he said.

December crude oil was set to open around 81 cents higher at $55.95/bbl, while December RBOB Gasoline was up fractionally and set to open at $1.7234/gal.