With only minor adjustments to the latest weather outlook, and with analysts pointing to tightness in the underlying supply/demand balance, natural gas futures managed to claw back a penny or so in early trading Friday. The March Nymex contract was up 1.7 cents to $1.846/MMBtu at around 8:45 a.m. ET.

Heading into Friday’s trading, day/day changes in the latest weather data were “quite minor,” according to Bespoke Weather Services. The forecaster observed a “small warmer change next week in the Midwest and East,” with no day/day changes to the outlook for the following week.

The European data advertised the same gas-weighted degree day total compared to 24 hours earlier, Bespoke said. The American data trended warmer, “but the change just brings it into better agreement” with the European data.

“Out toward the middle of February, models did show upper level ridging pushing closer to Alaska, which could be conducive for stronger cold into the central/western U.S., but until such a change shows consistency and is able to progress into the back of the six-to-10-day time frame, we remain hesitant to move the forecast colder in those regions than we are already showing,” the forecaster said. “Either way, getting cold into the eastern U.S. still looks quite difficult.”

Meanwhile, the Energy Information Administration (EIA) on Thursday reported a 201 Bcf weekly withdrawal from U.S. natural gas stocks for the week ended Jan. 24. That compares with a 171 Bcf withdrawal recorded in the year-ago period and a five-year average pull of 143 Bcf. Total Lower 48 working gas in underground storage stood at 2,746 Bcf as of Jan. 24, 524 Bcf (23.6%) higher than last year and 193 Bcf (7.6%) higher than the five-year average, according to EIA.

“Weather looks to have finally cooperated, as total degree days for the report week came in 18% above historical norms,” said Tudor, Pickering, Holt & Co. (TPH) analysts in a note Friday, “but what’s concerning to us is the dislocation between total degree days and withdrawals from storage, with cumulative degree days only 1% below the five-year average and total withdrawals tracking 12% below.

“Meanwhile, the natural gas market is continuing its undersupplied streak, with weather-adjusted historical degree day correlations pointing to a 2.5 Bcf/d undersupplied market, marking the third continuous week of undersupply.”

Even so, prices have gotten “unpleasantly close” to the $1.61 low recorded in March 2016, the TPH analysts said. They “continue to see additional supply cuts being required” to bring the market back to structural undersupply by the second half of 2020.

Genscape Inc. estimated this week’s 201 Bcf pull as tight versus the five-year average by around 1.5 Bcf/d when compared to degree days and normal seasonality.

“Weekly storage stats have been trending tighter versus weather, and this week’s report is the tightest storage stat we have seen since 2018,” Genscape analyst Eric Fell said.

Fell attributed the tighter balances in part to production declines on a combination of freeze-offs, maintenance and “some natural declines starting to set in.” Other factors include strong power burns driven by low gas prices, “surging” liquefied natural gas exports and residential/commercial demand growth, the analyst said.

March crude oil futures were up 17 cents to $52.31/bbl at around 8:45 a.m. ET, while February RBOB gasoline was up about 1.5 cents to $1.5087/gal.