September natural gas is expected to open 3 cents higher Thursday morning at $3.82 as traders prepare for the release of often market-moving storage data. Overnight oil markets fell.

The 10:30 a.m. EDT release of storage data by the Energy Information Administration (EIA) can be a trader's delight or nightmare. It's the only piece of real-time supply demand information and often causes extreme price moves. Often only a few Bcf above or below expectations can cause wide price swings. Today is no different, but the dominant trend has been for storage builds way above historical averages and, in many cases, above expectations as well.

Such may be the case this time around. Thursday's release of storage data by the Energy Information Administration is expected to show another large contraction in the storage deficit and builds nearly double historical averages. Last year, 57 Bcf was injected, and the five-year pace stands at 46 Bcf. Tim Evans of Citi Futures Perspective calculates an injection of 89 Bcf, and United ICAP is looking for an increase of 93 Bcf. A Reuters poll of 24 analysts revealed an average 93 Bcf with a range of 85 Bcf to 100 Bcf. Bentek Energy's flow model also chimed in with a 93 Bcf estimate.

"Total U.S. population-weighted cooling degree days fell for the fourth straight week, dipping below the 70 degree day mark for the first time since the June 27 storage week," Bentek said. "The relatively mild weather compared to historic norms helped keep Bentek's total sample of storage injections flat week-over-week. Combined with the low levels of demand were strong production levels, with Lower 48 dry gas production coming in above 68.5 Bcf/d for the week, which is the highest weekly average on record."

In its morning 20-day outlook, WeatherBELL Analytics said it sees no significant changes to the pattern of cool temperatures over the next two to three weeks. "[The] overall pattern of transience (lack of hit and hold heat) continues, [and] cool rules next two to three weeks overall," said meteorologist Joe Bastardi. "JMA [Japan Meteorological Association model] hints at warmer pattern for northern and central Plains for September, [and] SOI [Southern Oscillation Index] has a major negative burst lurking in the coming 10 days, then back to the lackluster mode."

WeatherBELL calculates diminished cooling requirements over the next two weeks. Nationally, it tabulates 149.3 cooling degree days (CDD), about in line with last year's 149.2 CDD but well short of a 30-year average of 170.1 CDD.

In overnight Globex trading September crude oil retreated 71 cents to $99.56/bbl and September RBOB gasoline shed 2 cents to $2.7980/gal.