Natural gas futures were trading slightly higher early Wednesday as analysts were looking for prices to stay in a narrow range amid a mix of near-term fundamental drivers. The May Nymex futures contract was up 1.4 cents to $2.713/MMBtu at around 8:30 a.m. ET.

EBW Analytics Group CEO Andy Weissman highlighted the tight trading range in Tuesday’s session, noting that the front month went as high as $2.725 and as low as $2.680 but generally stayed within a penny of the prior session’s close.

“Natural gas trading is in a lull, which could last for several more days, if not longer,” Weissman said. “...Near-term market drivers remain mixed. Production is down, most likely due to spring pipeline maintenance. Space heating demand is expected to briefly move higher, and utilization at Sabine Pass could start to rebound soon. In absolute terms, though, space heating demand is expected to remain low. Canadian imports have risen, and injections are expected to increase sharply later this month.

“The May natural gas contract is likely to trade within a narrow range today -- especially given the market’s tendency to trade sideways” in the lead-up to Thursday’s weekly Energy Information Administration (EIA) storage report.

As of Tuesday’s settle, Intercontinental Exchange EIA Financial Weekly Index futures were pointing to a 38 Bcf build for this week’s EIA report. That would easily top the five-year average 5 Bcf injection. Last year, during the unseasonably cold April 2018, EIA recorded a 20 Bcf withdrawal for the period.

“While we’re looking for a below consensus build in this week’s EIA report, we see potential for the following week to report a 100-plus Bcf build, or five times the five-year average, which would likely prove to be a negative catalyst for natural gas markets,” analysts with Tudor, Pickering, Holt & Co. (TPH) said.

“Flow data for the current week shows residential/commercial demand falling off a cliff, down around 9 Bcf/d week/week, which combined with depressed” liquefied natural gas feed gas “demand and a slightly weaker pull from power and industrial, has total demand down around 12 Bcf/d week/week.”

These numbers imply a risk that next week’s EIA report reaches the triple digits. Such a large build would shrink the storage deficit to the five-year average to 24%, “down from 34% in just three weeks,” the TPH team said, “further reducing any concerns over seasonally low storage levels.”

In its latest forecasts Wednesday, Radiant Solutions called for a variable pattern in the six- to 10-day period, while the 11-15 day outlook showed below normal temperatures in the Midwest.

In the six- to 10-day, “the forecast pattern during this time frame remains a progressive and variable one, with changes from previous being warmer along the West Coast and cooler during the latter stages in the Midcontinent,” Radiant said. “An area of low pressure emerges out of the Rockies and into the Plains early on, and a round of aboves precedes into the Midwest and South by mid-period before reaching the East Coast in the second half. Below normal temperatures, however, are left in this storm’s wake by the end of the period across the Midcontinent.”

Radiant’s 11-15 day forecast “features a cool change to start the period in the Midwest and South, left in the wake of low pressure along the East Coast at that time. Warm changes are along the West Coast and in the Southwest. Overall, below normal temperatures are favored in the Midwest, while aboves are in the Southwest and California. Confidence, however, remains lower than usual for this lead time on the variable nature of the pattern and the general lack of clear forcing mechanisms.”

May crude oil futures were up 33 cents to $64.31/bbl shortly after 8:30 a.m. ET, while May RBOB gasoline was up around 2.8 cents to $2.0273/gal.