With Florida bracing for impact and analysts predicting volatility ahead of this week’s front month contract expiration, natural gas futures posted modest gains in early trading Tuesday. The October Nymex contract was up 4.2 cents to $6.945/MMBtu at around 8:45 a.m. ET. November was up 2.9 cents to $7.043.

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After making landfall over western Cuba, Hurricane Ian was approaching the southeastern Gulf of Mexico early Tuesday, carrying maximum sustained winds of 125 mph, according to the National Hurricane Center (NHC).

The storm was expected to “pass west of the Florida Keys later today and approach the west coast of Florida” by Wednesday or Wednesday night, the NHC said. 

Ian was measured as a Category 3 hurricane. With strengthening expected later Tuesday, the storm was expected to reach Florida as a “dangerous major hurricane,” according to the forecaster.

Ian’s imminent arrival could raise the stakes for natural gas traders attempting to navigate the potentially volatile front month contract expiration this week. 

“Notwithstanding a brewing category 3 hurricane taking aim at Florida and looming triple-digit injections, thinning liquidity into final settlement heightens price volatility risks — in our view, with a modest recent bullish bent — over the next two sessions,” EBW Analytics analyst Eli Rubin said. 

Potential damage from Ian is one of several factors that could apply downward pressure to prices this week, a list that also includes Cove Point LNG terminal maintenance and potential production growth into the end of the month, according to Rubin.

However, once “this week’s numerous catalysts pass,” the sharp sell-off in natural gas prices over the last two weeks may prove “too much, too soon,” Rubin added. Should forecasts serve up chillier conditions for the mid- to late-October time frame it “could prompt a rebound for the November contract by next week.”

Meanwhile, the technical picture remained unchanged following Monday’s price action, according to ICAP Technical Analysis.

“Watching intently to see if natural gas pops from the $6.744 vicinity,” ICAP analyst Brian LaRose told clients. “If it does, we could be in for some sideways to higher price action to end the month. I am inclined to treat any such price action as corrective as long as natural gas remains below the 22-day moving averages.”

Should $6.744 be “decisively broken,” LaRose pegged a series of downside targets from $6.545 down to $6.207 as “the next big obstacle for the bears to conquer.”