Updated forecasts showing colder temperatures later this month helped push natural gas futures several cents higher in early trading Tuesday. The May Nymex contract was up 3.6 cents to $2.547/MMBtu at around 8:50 a.m. ET.

NGI Morning Natural Gas Price & Markets Coverage

Overnight runs of the American and European weather models added 10 heating degree days to the forecast for the April 13-20 period, a result of projections for colder weather systems moving into the eastern half of the country, according to NatGasWeather.

“The next seven to eight days remain emphatically bearish, with exceptionally light demand as most of the country warms above normal,” the firm said. “…However, after colder trends for April 13-20 in the overnight data, this period is now likely to be viewed as cold enough to satisfy.”

Aside from weather, liquefied natural gas feed gas demand volumes have been holding near record levels, a bullish factor for prices, NatGasWeather said.

“However, this has been more than offset by gains in Lower 48 production,” the firm said.

Looking ahead to Thursday’s U.S. Energy Information Administration report, Energy Aspects issued a preliminary estimate for a 23 Bcf build for the week ending April 2. The firm attributed the projected week/week increase in the injection rate to a 9% drop in heating degree days for the period, resulting in an estimated 2 Bcf/d decline in residential/commercial and industrial heating demand.

“We enter the injection season with March on pace to withdraw just 40 Bcf, 135 Bcf below the month’s five-year average,” Energy Aspects said in a recent note to clients. “The outperformance of March Lower 48 production continues to dictate the magnitude of looseness in our near-term balances.

“March Lower 48 production has realized at 93.3 Bcf/d, 0.8 Bcf/d above the January pre-freeze baseline. March outperformance not only stems from the return of flush production from shut-in U.S. Gulf Coast wells from the February freeze, but also an uptick in March completion activity across South Texas, Anadarko and Eagle Ford basins to make up for the lost output in February.”

Energy Aspects projected month/month Lower 48 production declines of 0.8 Bcf/d and 0.2 Bcf/d for April and May, respectively, with a return to growth projected for the summer.

“Overall, we expect Lower 48 summer production to grow by 0.5 Bcf/d (2.7 Bcf/d year/year) versus current levels, with month/month declines in April and May helping our end-October injection season forecast of 3.48 Tcf,” the firm said.

May crude oil futures were up 84 cents to $59.49/bbl at around 8:50 a.m. ET, while May RBOB gasoline was up about 1.7 cents to $1.9779/gal.