Amid hopes for a stimulus package from Congress to ease the economic burden of the coronavirus, and with forecasts trending colder overnight, natural gas futures were trading several cents higher in early trading Tuesday. The April Nymex contract was up 4.5 cents to $1.647/MMBtu at around 8:40 a.m. ET.

After initially dropping as low as $1.519, the front month recovered most of those losses Monday. EBW Analytics Group analysts attributed this recovery to a combination of “hopes that Congress will pass a multi-trillion dollar stimulus package” and “statements by President Trump suggesting that he might urge states to reopen the economy.”

Supporting prices early Tuesday, the latest weather guidance shifted cooler to increase demand expectations, the EBW analysts said.

“Further, the likelihood that Congress will act is increasing, giving natural gas a small boost,” they said. “With demand for natural gas dropping rapidly, however, we do not expect the move up to last for long. Further, even if President Trump orders” the Centers for Disease Control and Prevention to “modify federal guidance, the authority to lift restrictions rests with state governors, who are unlikely to back down given the risks to public health.”

Looking at the overnight guidance, NatGasWeather noted a gain of close to 15 heating degree days from the Global Forecast System, bringing it closer to the colder European model.

“Overall, the coming pattern remains rather bearish due to comfortable temperatures across much of the U.S. the next 15 days,” NatGasWeather said. But the outlook is “not quite as bearish in the latest overnight data for the first week of April” due to slightly cooler trends over the northern part of the country.

In terms of supply/demand balances, Energy Aspects recently revised its projected end-March storage carryout to 2.0 Tcf.

“End-March inventories are subject to even greater demand risks than usual, which are increasing as unknowns continue to mount for the weeks at the end of the traditional withdrawal season and beyond,” the firm said. “...The widespread closure in the U.S. of schools, offices and social spaces including restaurants and bars will impact commercial gas use, but we assume this loss in the very near term will be offset by a similar gain in residential use as workers operate remotely or stay at home.”

May crude oil futures were trading 57 cents higher at $23.93/bbl at around 8:40 a.m. ET, while April RBOB gasoline was up about 3.6 cents to around 44.8 cents/gal.