October natural gas is set to open 4 cents higher Thursday morning at $2.69 as traders await what are expected to be plump government storage figures and concentrate on near-term weather. Overnight oil markets rose.

Weather model runs turned slightly warmer overnight. Commodity Weather Group in its Thursday morning report said, “Warmer shifts for the Midwest to East were most notable in today’s update for the six-10 day into the 11-15 day. This is a trickier time of year as warmer changes in the Midwest offer smaller impacts on demand, while we can still see some marginal late-season cooling demand on the East Coast (80s vs. 90s).

“The Deep South is also slightly warmer today, while the West is cooler following the strong heat over the next few days. Sacramento is forecast to be at 107 F today and tomorrow, which would both be record highs,” said Matt Rogers, president of the firm.

With the 10:30 a.m. EDT release of storage figures by the Energy Information Administration (EIA) traders will have a chance to fine tune their estimates of inventory going into the winter heating season. With 3,193 Bcf in storage and nine weeks to go on the traditional injection season, weekly increases of 90 Bcf will be required to reach the marquee level of 4 Tcf and set a new inventory record in the process.

This week’s build expectations a little short. Last year, 90 Bcf was injected, and the five-year average stands at 63 Bcf. ICAP Energy is looking for a 80 Bcf increase and IAF Advisors calculates a 74 Bcf build. A Reuters survey of 25 traders and analysts revealed an average 75 Bcf with a range of 69-82 Bcf.

Jim Ritterbusch of Ritterbusch and Associates contends that the market is becoming less focused on near-term weather forecasts and is concentrating on what storage builds will look like during the shoulder season. “The price consolidation of the past 2 and a half weeks within a very narrow 10-cent range is reinforcing our opinion that most favorable trading opportunities will take the form of option straddle strategies designed to collect premium,” he said in opening comments Thursday to clients.

“So while we still feel that [Thursday’s] storage report could contribute to fresh lows to around the $2.58 area, we will also expect a renewed lift back into this recent trading range by the end of next week. Regarding today’s EIA release, we feel that a bearish miss is more likely than a bullish figure given the recent upswing in production and possible increase in imports. An injection of more than 80 Bcf is certainly possible and would likely jam nearby futures to below the $2.63 support that has been validated on several occasions this month.

“And while the daily shifts in the short-term temperature views are prompting some price volatility, the expected above-normal trends out to about the 24th of this month are not showing enough deviation from normal to spur sustained buying interest.”

In overnight Globex trading October crude oil gained 24 cents to $44.39/bbl and October RBOB gasoline added a penny to $1.3690/gal.