April natural gas is set to open 3 cents lower Wednesday morning at $4.38 as traders discount a somewhat cooler, though mixed weather outlook. Overnight oil markets rose.

Weather forecasters are calling for a cool April. Commodity Weather Group in its morning 11- to 15-day outlook shows below-normal temperatures hovering throughout the northeast one-fourth of the country. “A departing major Atlantic storm this morning [Wednesday] whips around stronger winds for East Coast cities, offering significant wind chill demand enhancements to the last piece of this week’s strong cold air mass,” said Matt Rogers, president of the firm.

“The pattern still becomes more variable in the six-15 day time frame, but the cooler periods seem to outweigh the warmer ones yet again for the Midwest and East, although we do not see any cold outbreaks to rival this week’s levels. Otherwise, Texas sees some brief bursts of heat at times over the next two weeks, with rounds of stronger 80s. California and the Southwest see some cooler variability at times, but the warm periods continue to outweigh them, although the risk for more 90s in Phoenix early next week faded a bit. The extended range CFS [Climate Forecast System] guidance continues to lean the Midwest to East cool deeper into April yet.”

Analysts saw Tuesday’s advance mostly as a result of a cooler temperature outlook as opposed to any bullish tone to expected storage figures.

According to Tim Evans of Citi Futures Perspective “the consensus view for Thursday’s DOE storage report is still in formation, but we wouldn’t say estimates played much of a role in Tuesday’s advance, with most of the estimates we’ve seen so far coming in at the low 50s, just a minor step up from the prior week’s 48 Bcf net withdrawal.

“With our model projecting a somewhat higher 61 Bcf draw, we do see some potential for a bullish surprise. The anticipated draw is still supportive compared with the five-year average of just 7 Bcf, but the market has certainly managed to ignore such variances over the past four weeks.” Last year, however, 90 Bcf was pulled.

By April 11 Evans forecasts that the year-on-five-year deficit will reach a stout 1,012 Bcf, in part due to colder weather, which added 18 Bcf more demand than previously predicted. “Although it’s possible that the 18 Bcf in additional heating demand was a critical volume that tipped the balance in the market from bearish to bullish, we also think the market may have been somewhat undervalued, reaching about the limit of how far it could sink at a time with inventories at the lowest level since 2003. A rally back to $4.50 would confirm that the wider market has reached a similar conclusion,” he said in closing comments Tuesday.

For the moment, demand figures aren’t quite in alignment with the increases noted by Evans. “Despite cooler than normal temperatures, Southeast demand has decreased -1.2 Bcf/d day-on-day to 15.8 Bcf/d from yesterday’s 17.0 Bcf/d,” said industry consultant Genscape in a Wednesday morning report. In addition it said demand in the Midwest “decreased -1.3 Bcf/d day-on-day to 13.2 Bcf/d from yesterday’s 14.5 Bcf/d.

In overnight Globex trading May crude oil added 52 cents to $99.71/bbl and May RBOB gasoline rose a penny and a half to $2.8965/gal.