With cooler-than-normal temperatures predicted over the next two weeks and large storage deficits likely to remain, November natural gas futures were trading 7.6 cents higher at $3.342/MMBtu shortly after 8:30 a.m. ET Wednesday.

Forecasts continued to trend colder overnight for late this week through Oct. 24, adding numerous projected heating degree days on a series of weather systems expected to move in across the northern and eastern United States, according to NatGasWeather.

“The impact from the coming cooler-than-normal pattern will be to further increase already hefty deficits in supplies, keeping them above 600 Bcf through October, but only after easing just slightly” with the Energy Information Administration’s next two weekly storage reports, the firm said. “Thus, no change bigger picture as deficits are expected to remain impressive and at multi-year highs by the time truly cold polar air lurks.

“With that said, weather patterns have trended increasingly bullish since the start of the week, suggesting any decent selloffs will find buyers as long as colder-than-normal temperatures remain in the forecast across the northern and eastern U.S.,” NatGasWeather said. “With prices higher overnight to test resistance, this leaves the potential for higher highs with the data continuing to trend colder.”

Prices may have stalled during Tuesday’s session in part because of potential demand destruction from Hurricane Michael bearing down on the Florida coast, according to EBW Analytics Group CEO Andy Weissman.

“The main lesson to be drawn, however, is that after the huge run up of the past two weeks, traders were not yet ready for another major leg higher,” Weissman said. “...With the end of injection season nearing, if Weeks 3-4 trend colder, the November contract could challenge resistance as high as the upper $3.40s.”

At 8 a.m. ET, Hurricane Michael was about 90 miles southwest of Panama City, FL, and traveling north at 13 mph, according to the National Hurricane Center (NHC).

The storm, now rated a Category 4, was expected to turn toward the north-northeast later Wednesday morning and then turn northeast later in the day before picking up speed as it continues to head northeast Thursday and Friday, NHC said.

“On the forecast track, the eye of Michael is expected to move ashore over the Florida Panhandle later today, move northeastward across the southeastern United States tonight and Thursday, and then move off the Mid-Atlantic coast away from the United States on Friday,” the forecaster said.

NatGasWeather said the storm could bring a mix of bearish and bullish impacts on natural gas markets, including a small drop in production offset by power outages and comfortable temperatures.

“It would be considered more bearish if it was to hit during core summer months when the storm would ease more impressive heat,” the firm said.

A little after 8 a.m. ET Wednesday, November crude oil futures were trading 17 cents lower at $74.79/bbl, while November RBOB gasoline was trading fractionally lower at $2.0755/gal.