Taking cues from gains in equity markets as concerns over a coronavirus-driven economic slowdown continue, natural gas futures were trading slightly higher early Friday. The April Nymex contract was up 1.5 cents to $1.669/MMBtu at around 8:45 a.m. ET.

Bespoke Weather Services viewed the early gains for natural gas Friday as connected to gains for equity markets.

“Whenever there is optimism there, it bleeds over into natural gas, perhaps with the idea that maybe things are not as bad and we will see not quite as much demand destruction with a slowing economy,” Bespoke said. “Of course, sentiment seems to flip daily, sometimes even multiple times over the course of one day, so we would still be cautious if trading in the near term.”

Longer-term, however, Bespoke said it sees upside risks for prices unless the economy “really slows” and there are “significant” impacts to liquefied natural gas exports.

Meanwhile, the Energy Information Administration (EIA) on Thursday reported a larger-than-expected 9 Bcf weekly withdrawal from U.S. gas stocks. The 9 Bcf withdrawal falls well short of both the 91 Bcf withdrawal EIA recorded for the year-ago period and the five-year average pull of 63 Bcf.

Total Lower 48 working gas in underground storage stood at 2,034 Bcf as of March 13, 878 Bcf (76.0%) above year-ago levels and 281 Bcf (16.0%) higher than the five-year average, according to EIA.

Looking at this week’s data, analysts at Tudor, Pickering, Holt & Co. (TPH) said the inventory surplus to historical norms is “getting ugly” when viewed by region.

“As we get into the tail end of withdrawal season, we’re checking back in on regional storage where the Midwest looks pretty ugly at plus 31% versus the five-year average and across the Great Lakes at the Dawn hub things are worse, with inventories at plus 45%,” the TPH analysts said. “The East region is similarly challenged at plus 32%, and the Mountain is the only one below the five-year at minus 12%.”

As for the overnight guidance, Bespoke said it returned about 5-6 gas-weighted degree days to its outlook for the next 15 days, albeit with the pattern remaining warmer than normal.

“Balance data looks rather stable,” Bespoke said. “Again, directionally, the moves will likely remain at least somewhat tied to the directional move in other markets, but over the next few weeks the data should gain importance as we get a clearer idea how much demand is being lost. Until then, price action can remain quite erratic.”

April crude oil futures were off 30 cents to $24.92/bbl at around 8:45 a.m. ET, while April RBOB gasoline was up fractionally to around 69.4 cents/gal.