March natural gas is expected to open 9 cents lower Tuesday morning at $2.74 as both near- and medium-term temperature forecasts call for less heating load. Overnight oil markets were unchanged to higher.

WSI Corp. in a Tuesday morning report to clients said its six- to 10-day and 11- to 15-day forecasts were warmer than Monday’s. In the 11- to 15-day outlook it said the “forecast is warmer than yesterday’s forecast, except for parts of the East. CONUS GWHDDs are down three for days 11-14 when compared to yesterday and are forecast to be 101.5 for the whole period. These are 18.3 below average.

“Forecast confidence levels are only near average, at best, today. Models continue to support a change from a -PNA [Pacific North American pattern] to -WP [West Pacific] that should foster a broad cooling trend. However, there remains model spread and uncertainty with how quickly and how much cold air expands into the eastern two-thirds of the U.S.”

Market analysts contend that as long as mild temperatures force an ongoing supply surplus expansion, a market bottom is not likely any time soon.

“Much of the nation’s Midcontinent, such as the critical Chicago area, are seeing near-record high temperatures that are forcing a recalculation of HDD accumulation during the next couple of weeks,” said Jim Ritterbusch of Ritterbusch and Associates in a Tuesday morning report to clients. “It appears that withdrawals will be sharply downsized, at least through the EIA report to be issued on March 9th. This week’s release on Thursday is apt to post about an 85 Bcf withdrawal, according to our calculations, a decline that would imply a whopping 73 Bcf expansion in the supply surplus against five-year average levels.

“Until this dynamic of surplus expansion shows sign of reversal, a price bottom could prove elusive. Furthermore, with reliable short-term temperature views soon to be extended into the second week of March, the likelihood of a major broad-based cold spell will be reduced. In other words, even some major cold deviations from normal wouldn’t necessarily equate to a large accumulation of HDDs. Although gas pricing below the $2.75 level will begin to prompt some additional coal-to-gas substitution that will be boosting demand within the power sector, this factor tends to be a slow mover.”

In overnight Globex trading the expiring March crude oil added 94 cents to $54.34/bbl and March RBOB gasoline was unchanged at $1.51660/gal.