As traders prepared to turn their attention to the latest government storage data, likely to show the biggest storage withdrawal of the season, natural gas futures were trading lower early Thursday following weaker cold forecast in the overnight weather data. The March Nymex contract was down 2.5 cents to $1.840/MMBtu at around 8:30 a.m. ET.

The Global Forecast System (GFS) trended colder overnight for the period around Feb. 10-15, but the European model dropped a chunk of heating demand from its projections by showing “much less cold air” reaching the northern part of the country around Feb. 10-14, according to NatGasWeather.

“The natural gas markets seemed to notice the European model losing yet again as prices dropped several cents overnight after it trended further milder,” NatGasWeather said. “Not a huge surprise, as over the past few months, whenever the weather data advertised rather cold conditions for the 12-15 day period, the data trended milder as these days rolled into the day five to 11 period.

“So, unless the European model trends back colder today, the natural gas markets will again be disappointed it backed off on cold. Sure, the GFS is colder, as it’s been most of this winter, but most times it gives in to milder trends.”

Meanwhile, estimates for this week’s Energy Information Administration (EIA) storage report, scheduled for 10:30 a.m. ET, have been pointing to a larger-than-average withdrawal in the neighborhood of 200 Bcf.

A Bloomberg survey as of Wednesday produced a median prediction for a 197 Bcf withdrawal for the report, which covers the week ended Jan. 24. Responses to a Wall Street Journal survey averaged minus 195 Bcf, while a Reuters survey also landed on a 195 Bcf pull. Predictions ranged from minus 179 Bcf to minus 216 Bcf. NGI’s model predicted a 210 Bcf withdrawal.

Last year EIA recorded a 171 Bcf withdrawal for the similar week, while the five-year average is a pull of 143 Bcf.

“It was colder than normal over most of the eastern half of the U.S., while warmer than normal over the West, Texas and portions of the Upper Midwest” during this week’s EIA report period, NatGasWeather said. “Our algorithm predicts minus 199 Bcf, although it’s tricky due to a tighter supply/demand balance and the Martin Luther King Jr. Day holiday.”

Genscape Inc. said it’s modeling a 202 Bcf withdrawal for Thursday’s report.

“If realized, this will be tight compared to the five-year average by roughly 1.6 Bcf/d,” Genscape senior natural gas analyst Rick Margolin said. “This week’s report will be the largest withdrawal this winter, but in a winter featuring record January warmth, it still pales in comparison to the largest draws of the previous three winters.”

Last winter, the largest pull clocked in at minus 237 Bcf for the week ended Feb. 1, 2019, according to EIA data. For the 2017/18 winter, the largest withdrawal was a 359 Bcf pull for the week ended Jan. 5, 2018.

March crude oil futures were down 98 cents to $52.35/bbl at around 8:30 a.m. ET, while February RBOB gasoline was off about 4.0 cents to $1.4906/gal.