July natural gas is expected to open 5 cents higher Monday morning at $2.98 as traders study longer-directed weather forecasts. Overnight oil markets rose.

Natgasweather.com in its morning report to clients said it was anticipating the timeline of major features to impact the US the next few weeks to remain intact. “Most importantly, the data locked on to a large-scale very warm to hot ridge of high pressure that will dominate much of the country July 5-8th where widespread highs of upper 80s to 100s would be expected to drive the strongest natural gas demand observed so far this season. Until then, cool conditions remain in the wake of a weather system and associated cool front that swept across the central and eastern US this past weekend, including deep into the Southeast.”

Risk managers are booking gains on short spec positions. “Natural gas settled lower across the board. The market broke sharply on Monday, but when key support ($2.80-$2.90) held, gas traded in a tight range for the balance of the week,” said Mike DeVooght, president of DEVO Capital in a weekly note to clients. DeVooght noted that the weekly storage number was considered negative because of a larger than anticipated injection, but failed to be a market mover. Warmer weather in the west could help support western gas basis, but cooler temperatures in the east and south could continue to pressure NYMEX natural gas.

“On a trading basis, we have been looking for gas to test to the $2.80-$2.90 level. Now that we have done so, there is a good chance of a technical rally. We are not bullish, but would not be surprised to see a rally back to the $3.10-$3.20 level. If gas were to break the $2.80 level, the next support is $2.10. At this time, we would book profits on short speculative positions and stand aside. For hedgers, we will maintain current positions.”

According to Baker Hughes Inc. (BHI) rig count data released Friday, three U.S. natural gas rigs packed up for the week. That left the United States to finish at 941 rigs total (758 oil, 183 gas), up eight for the week and 520 above the year-ago tally. Canada added 11 rigs for the week, seven oil and four gas.

Crude oil producers seem undeterred by the recent collapse in crude oil quotes. North American drillers for the week ended June 23 added 11 oil-directed rigs.

In overnight Globex trading August crude oil rose 18 cents to $43.19/bbl and August RBOB gasoline gained fractionally to $1.4242/gal.