With guidance appearing to settle on an overall colder theme for later this month, natural gas futures added several cents in early trading Friday. The February Nymex contract was up 4.0 cents to $2.206/MMBtu at around 8:30 a.m. ET.

Models have been “very volatile” recently but have begun to coalesce around a colder look heading into the back half of January, according to Bespoke Weather Services.

“The overall theme the last couple of days has remained consistent...which suggests that we are heading into a period where colder risks have a better chance to finally become reality,” the forecaster said. “Our target based on tropical forcing signals has been more into the final third of the month. This stood out in the overnight runs, as they went warmer quite notably in the six to 10 day period but did show the colder potential after that.

“There will still be some skepticism, as yet again cold is weakening” in the nearer term outlook, but “we think that finally changes once the final third of the month rolls into the six to 10 day time frame in next week’s modeling.”

Meanwhile, what Tudor, Pickering, Holt & Co. (TPH) analysts described as an “ugly run of weather” has taken its toll, yielding weaker-than-normal inventory withdrawals. The Energy Information Administration (EIA) on Thursday reported a lighter-than-expected 44 Bcf weekly withdrawal from U.S. gas stocks.

The 44 Bcf pull, recorded for the week ended Jan. 3, is much smaller than historical norms for this time of year. Last year, EIA recorded a 91 Bcf withdrawal for the week ended Jan. 4, 2019, and the five-year average according to NGI calculations is a 169 Bcf pull.

Total Lower 48 working gas in underground storage stood at 3,148 Bcf as of Jan. 3, 521 Bcf (19.8%) higher than last year and 74 Bcf (2.4%) above the five-year average, according to EIA.

“For the second straight week gas inventories reported a withdrawal well below the five-year average, and, unfortunately, we’re expecting much same again next week,” the TPH analysts said. “In total, the ugly three-week run is expected to result in cumulative draws 274 Bcf softer than the five-year average.”

In terms of ascribing blame for the “particularly ugly” 44 Bcf pull reported this week, “the finger can be squarely pointed at the weather, as degree days were 23% below normal levels, although cumulative degree days this withdrawal season are still 3% above the five-year average.” Even so, “persistent oversupply” has limited withdrawals to 9% below norms.

On a weather-adjusted basis, the TPH analysts viewed the 44 Bcf withdrawal as implying a 3.5 Bcf/d oversupplied market.

“With no significant demand adds expected in the near-term, we continue to see supply reductions as being key to a balanced market,” they said.

February crude oil futures were unchanged at $59.56/bbl at around 8:30 a.m. ET, while February RBOB gasoline was up about 1.5 cents to $1.6676/gal.