April natural gas is expected to open 4 cents higher Wednesday morning at $2.76 as traders discount weather forecasts calling for eastern warming later in the month. Overnight oil markets were mixed.

Going into Thursday’s Energy Information Administration (EIA) inventory report, industry expectations are circulating in the 220 Bcf to 225 Bcf range, but one forecaster has tallied fewer heating degree day accumulations, and that has led to a lower estimate.

“The consensus view shows a modest step up from the 219 Bcf decline in the prior week, but we saw a decline in the Frontier Weather population-weighted degree day accumulations, and so our model points to a lower 195 Bcf draw,” said Tim Evans of Citi Futures Perspective.

“We’d take this divergence as indicating the possibility of a bearish surprise in Thursday’s DOE storage report, but not a strong enough reason to sell ahead of the data release. With the 11-15 day outlook turning somewhat cooler on Tuesday, we also see enough heating demand for the week ending March 20 to limit what could still be the first storage build of the year.”

By March 20 Evans figures show the current 30 Bcf year-on-five-year deficit growing to 132 Bcf as the industry records its first storage injection.

“Although the broadening year-on-five-year average deficit confirms the market will be tighter on a seasonally adjusted basis in the near term and this often translates into a price rally over the intermediate term, the market rejected an attempt to move higher off the cold itself and is showing little fear in the face of the resulting above-average storage withdrawals,” Evans said. “At the moment, the market remains fully focused on the approach of spring — that and perhaps the background uptrend in natural gas production. Of course, there is always some chance that the market might snap out of its complacency and back to the upside after all.”

Meteorologists posting on blog site The Weather Centre studying Global Forecast System ensembles see “a massive ridge of high pressure, the same one which has allowed for such a cold and snowy February, meandering westward over the north-central Pacific, as opposed to the northeast Pacific and Gulf of Alaska. This comes as a strong trough drops into the Southwest and Baja California.

“In response, with the strong upper-level low previously positioned over Greenland now over Europe, a ridge is able to form over the central and east U.S. It looks like this ridge will be suppressed a bit, but warmer weather is on the way for those in the Plains, Midwest, Ohio Valley and Northeast, among other areas.”

In overnight Globex trading April crude oil rose 24 cents to $50.76/bbl and April RBOB gasoline fell 3 cents to $1.9222/gal.