December natural gas is expected to open 4 cents lower Tuesday morning at $2.99 as traders factor in a modest decline into long-term support and weather models remain moderate. Overnight oil markets gained.

Overnight weather models have backed off any near-term incursion of cooler, more seasonal air. “No major changes are noted [Tuesday] morning, but the net result of today’s outlook looks slightly warmer,” said Commodity Weather Group in a Tuesday morning note to clients. “Yesterday afternoon’s modeling came in collectively warmer, while last night’s came in cooler overall, but it was not enough to make up for those afternoon losses.

“The same big picture view holds as yesterday with this week being the warmest period and then next week being on the warm side, but not nearly as strong. The models had been leaning toward cooler risks for the East Coast this weekend into next week, but they backed away a bit in recent cycles, leading us to range from normal to slightly above,” said Matt Rogers, president of the firm.

Traders see further declines. “From here, we are leaving open the possibility of additional decline to about the $2.95 area per nearby futures where we expect long-term support,” said Jim Ritterbusch of Ritterbusch and Associates. “But at the same time, we are still cautioning against attempts to pick a price bottom on an outright basis. We have, instead, suggested bull spreads such as long March 2017 — short September 2017. Any positions established in this trade today would be advised to risk to about a 3-cent inversion, and we will look for eventual inversion expansion back to around the 21-cent area.

“So although this market appears quite soft at the present time as it is being forced to price in a storage peak north of 4 Tcf, we still feel that the first swing in the temperature views toward broad-based below-normal trends will induce a scramble back into the long side that will keep nearby futures elevated north of the $3 mark through most of next month.”

In overnight Globex trading December crude oil rose 14 cents to $47.00/bbl and December RBOB gasoline jumped 14 cents to $1.5638/gal.