After several failed attempts, natural gas bears took out a stubborn level of support early Wednesday as weather models continued to trim demand from their outlooks. The January Nymex gas futures contract was trading at $2.268 at 8:15 a.m. ET, down 5.1 cents from Tuesday’s close.

“The weather data has consistently trended milder going back to last Friday, but prices held up quite well despite it,” NatGasWeather said. “However, prices are again lower overnight after continued further trends” with the Global Forecast System (GFS) losing another 10 heating degree days (HDD) and the European model losing 3-4 HDDs.

The GFS teases cold air finally pushing back into the northern United States around Dec. 30, according to NatGasWeather. The European model also sees cooler air building in the region around the same time, just not nearly as cold.

Barring any significant flips back to colder, it appears that today may be the highest demand day for the rest of 2019. Furthermore, the impact of the turn to milder temperatures beginning Friday (Dec. 20) through Dec. 30 will be to flip year/year storage deficits back to surpluses, which will likely continue expanding until more ominous cold arrives.

The U.S. Energy Information Administration (EIA) is scheduled to release its weekly storage inventory report on Thursday. Early estimates are calling for a withdrawal ranging from the upper 70s Bcf to around 105 Bcf, with most projections clustering around a pull in the low 90s Bcf. This would compare with the 132 Bcf withdrawal EIA recorded in the year-ago period and the 112 Bcf five-year average draw.

Inventories as of Dec. 6 stood at 3,518 Bcf, 593 Bcf above last year and 14 Bcf below the five-year average, according to EIA.

In addition to unsupportive weather outlooks, another significant headwind for the natural gas market is pervasive bullish sentiment regarding crude oil pricing, according to Mobius Risk Group. If West Texas Intermediate (WTI) crude’s move up toward the $60/bbl mark has legs, and if drilling activity responds, “the subsequent production of incremental associated gas molecules will meet a natural gas market already infected by a narrative of perpetual oversupply.”

At around 8:15 a.m., WTI crude oil futures were trading at around $60.57, down 37.0 cents day/day. RBOB gasoline futures were trading at around $1.661, down 2.47 cents.