The August natural gas futures contract was set to open Thursday slightly higher at around $2.985/MMBtu, with prices supported by heat in the forecast as the market turns its attention to the 10:30 a.m. EDT release of weekly government storage data.

August takes over as the prompt month after the July contract on Wednesday made a run at a $3-plus expiration before going off the board at $2.996, up 5.7 cents on the day.

August’s first real prompt-month test is to come Thursday when the Energy Information Administration (EIA) releases its natural gas storage report for the week ended June 22. Consensus estimates have been pointing to a build in line with the five-year average.

Mobius Risk Group is forecasting the injection at 70 Bcf, which would imply relatively flat year-on-year demand growth and be consistent with the previous week’s reported injection of 91 Bcf. A Reuters poll of 25 industry traders and analysts produced a tight 64 Bcf to 76 Bcf injection range with a 71 Bcf consensus expectation. The number revealed Thursday will be compared to last year’s 48 Bcf build and a five-year average injection of 72 Bcf.

“Each of the past two reports have come in roughly 7 Bcf above consensus, indicating that the market may be up to 1.0 Bcf/d looser than analyst expectations,” EBW Analytics Group CEO Andy Weissman told clients Thursday. Thursday’s report, “if similarly bearish, could help confirm this oversupply and result in a quick re-test of support near $2.88. Alternatively, a bullish report could indicate a more balanced market near-term -- potentially clearing the way higher above $3.00/MMBtu.”

Bespoke Weather Services said it sees a good chance for this week’s report to come in below consensus and potentially spark a run above the $3 mark.

“However, we are still at 70 Bcf, which is just a touch below consensus currently, and if that hits we are skeptical that prices could really rally,” Bespoke said. “The main bullish catalyst here is clearly the upcoming heat, with the question being how much is priced in. Heat through the next two weeks will be incredibly intense and approach record levels, and should keep cash and the front of the strip bid.”

However, by next week “it should become even more clear that into mid-July heat should break down, and with production near record levels this would allow for significant downside,” the firm added. “Thus though there is risk for a pop into the end of the week off EIA data, any rally from these levels remains” a shorting opportunity.

Radiant Solutions on Thursday noted hotter changes to both its six- to 10-day (July 3-7) and 11-15 (July 8-12) outlooks.

Hotter forecast adjustments in the six- to 10-day were “focused around the Great Lakes and in the East,” the firm said. “This comes as a result of the further disconnect from a Canadian source region for high pressure progressing across these areas in the early half. An intense ridge is well agreed upon in models to span most of the Lower 48, and above and much above normal temperatures are widespread in coverage” except along the West Coast.

In the 11-15 day outlook, Radiant said it added “a few more days of much above normal coverage in the West. The East Coast is also warmer, with aboves preceding the passage of low pressure through this region leading into mid-period.”

August crude oil future were set to open about 32 cents lower at around $72.44/bbl, while July RBOB gasoline was trading fractionally lower at around $2.1293/gal.