A hotter shift in forecasts over the weekend helped spark a rally for natural gas futures in early trading Monday. The August Nymex contract was up 7.9 cents to $3.753/MMBtu at around 8:50 a.m. ET.

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Forecasts increased demand expectations over the weekend by showing hotter temperatures to close out the month of July, according to Bespoke Weather Services.

“The change was not large” in terms of total gas-weighted degree days, “but there are some notable shifts on the regional level, as the lower Midwest down to Texas appears set to finally see some heat after quite a tame period in recent weeks,” Bespoke said. “We are projecting highs in Dallas, for example, to reach the 100 degree mark a few times in the medium range, something of course not uncommon for this time of year, but definitely a change from what we have been seeing.”

EBW Analytics Group analysts similarly noted hotter changes to the forecast that would increase demand during the second and third upcoming storage weeks, or from Friday through Aug. 5. Projections from forecaster DTN also point to hotter-than-normal conditions extending beyond that into the fourth upcoming storage week, according to EBW.

“The potential for hotter weather during the first half of August could boost cash and futures this morning, but overcoming resistance at $3.81-3.82 remains a formidable challenge,” the EBW analysts said.

Prior to the hotter shift in forecasts over the weekend, natural gas futures had shown “considerable resilience” in Friday’s trading, the EBW analysts said.

They attributed this resilience to a combination of strong prices in the day-ahead market at Henry Hub, weak production due to pipeline maintenance, rebounding liquefied natural gas feed gas flows and concerns over the adequacy of inventory levels going into the start-of-winter.

The latest Lower 48 production estimates early Monday showed output falling short of the levels that would likely be needed to allay the market’s anxiety over supply adequacy, according to Bespoke.

“On the fundamentals side, our thesis remains that we just do not have the production necessary to alleviate storage concerns,” Bespoke said. “Yes, we did rise to 91.5 Bcf/d over the weekend, but we need to get back to and even make new 2021 highs as we move forward in order to feel more comfortable, especially with a pretty consistent 17-18 Bcf/d in total exports, which could grow slightly in the fourth quarter.”

Looking ahead to this week’s Energy Information Administration storage report, NGI’s model is predicting a 30 Bcf injection for the week ended July 16. That would compare with a 38 Bcf build in the year-ago period and a five-year average injection of 36 Bcf.

August crude oil futures were down $2.52 to $69.29/bbl at around 8:50 a.m. ET.