Natural gas futures retreated somewhat early Wednesday as traders weighed the potential for the front month expiration and the impending release of new government inventory data to influence prices.

NGI Morning Natural Gas Price & Markets Coverage

The expiring December Nymex contract was down 2.4 cents to $2.751/MMBtu at around 8:45 a.m. ET. January was down 2.0 cents to $2.880.

The latest forecast from Bespoke Weather Services early Wednesday extended colder trends from earlier in the week, maintaining a shift toward comparatively chillier temperatures well into the month of December.

“Models remain consistent with the idea of the upper level low around Alaska pulling back toward Siberia, just enough to allow troughs to slide into the eastern U.S., giving colder variability to the East and South,” Bespoke said.

This could result in the first third of December coming in near or slightly colder than norms over the past five to 10 years, according to the firm.

“This December pattern has become quite tricky, as long-range modeling remains very much in the warm-dominated camp, but the 15-day modeling suggests that variability could continue on into the middle of the month,” Bespoke said.

The expiration of the December contract Wednesday, the holiday-adjusted release of the latest Energy Information Administration (EIA) storage report and “lower confidence in the longer-range weather pattern makes guessing the next move in prices difficult,” the firm said.

EIA will report this week’s storage report at noon ET, a day earlier than normal because of Thanksgiving. The results could drive markets in either direction, as expectations vary widely.

A Bloomberg survey released Tuesday landed at a median 19 Bcf decrease for the week ended Nov. 20, though estimates ranged from a withdrawal of 47 Bcf to a build of 35 Bcf. Reuters’ poll found estimates spanning a withdrawal of 47 Bcf to an injection of 33 Bcf, with a median decrease of 21 Bcf. 

A survey conducted by the Wall Street Journal found analysts, on average, estimating storage levels declined by 8 Bcf. However, forecasts were also spread across a wide spectrum, varying from a withdrawal of 47 Bcf to an increase of 36 Bcf. NGI’s model predicted a 35 Bcf pull from underground stocks. 

Last year EIA recorded a 47 Bcf withdrawal for the similar week, and the five-year average is a decrease of 37 Bcf.

“It was warmer than normal over the western two thirds of the U.S. and near normal over the East” during this week’s EIA report period, according to NatGasWeather. “Our algorithm predicts minus 20 Bcf, to the bearish side.”

Early price action Wednesday “could be just the start of what’s expected to be a wild day” amid the release of storage, the front-month expiration and “major players positioning ahead of the Thanksgiving holiday,” the firm said.

January crude oil futures were up 35 cents to $45.26/bbl at around 8:45 a.m. ET, while December RBOB gasoline was up fractionally to $1.2669/gal.