Despite little change in the latest weather models, March natural gas prices were set to open marginally higher Tuesday after four straight days of losses as traders sought to take profits ahead of a brief cold snap expected this weekend. The Nymex March gas futures contract was trading at around $2.69, up 2.9 cents, at around 8:30 a.m. ET.

The modest bump occurred as major weather model differences continue between the milder Global Forecast System (GFS) model and the colder European model, especially with a weather system late next week that the European tracks across the Midwest and Northeast with strong demand, while the GFS holds a strong ridge over the Great Lakes and East blocking it in a rather balmy pattern, according to NatGasWeather.

The European model remained nearly 20 heating degree days (HDD) colder than the GFS but it didn’t lose or gain any run total HDDs, only redistributed them. The GFS model added four HDDs compared to Monday’s midday data and mainly at the back end of the forecast, the firm said.

“Overall, there will be several notable swings in national demand over the coming two weeks, but to what extent depends on which weather model you believe. Also of interest, both the GFS and European models tease a rather frigid pattern Feb. 19-20, with much of the United States experiencing below-normal temperatures.”

Despite the prospects for more chilly weather later this month, the market has shown very little concern in these late innings of winter. Supporting this sentiment is a salt storage balance that remains mired in a meaningful year/year surplus, healthy injections over the weekend and Monday’s bal-month strip at Henry Hub, which signaled a possible continuance of this trend through February, according to Mobius Risk Group.

“However, it is still winter and change can come about quickly. It is important to consider that Monday’s market was forced to deal with deleterious demand impacts of the second warmest Feb. 4 in the past 69 years” and the sixth warmest Feb. 5 in the past 69 years, if current outlooks hold.

By Friday, the Lower 48 is expected to be colder than normal again, however, only for the weekend. Because of this week’s extreme warmth and the short duration of the cold shot forecast for this weekend, upside risk/opportunity will rely heavily on this Thursday’s Energy Information Administration (EIA) inventory report and/or daily weather models, Mobius said.

“A weaker-than-expected EIA number and/or warmer progression could cause the front of the curve to press round number support at $2.50. While the fundamental argument for such a move is anything but concrete, momentum can be a powerful force when withdrawal season is coming to a close,” analysts said.

Indeed, the March/April contract spread -- a measure of market winter risk premiums -- has tightened dramatically since the beginning of winter, falling from a high of $1.16 in mid-December to less than two cents after Monday’s close.

Early November and December cold prompted a wide March-April spread amid market concern about late winter supply adequacy. The January forecast bust, however, prompted the spread to shrink dramatically as late March inventories looked to be on a safe trajectory, even as subsequent concerns about February cold drove a modest rebound, according to EBW Analytics.

“With late winter supply adequacy concerns all but eliminated, it's likely the March contract will begin trading at a discount to April as the Nymex forward curve slips into contango,” EBW CEO Andy Weissman said.

Crude oil futures were trading more than 60 cents lower at around $54/bbl, and RBOB gasoline futures were trading 1.65 cents lower at around $1.415/gal.