U.S. natural gas futures were little changed on Jan. 15 after surging almost 16% on Jan. 14, as forecasts for less cold next week than previously expected offset projections for brutally frigid weather at the end of the month.

In their latest outlook, meteorologists said the weather would remain near normal this week and colder than normal next week before a deep freeze blankets the middle of the country
during the last week of January.

Those cold forecasts and renewed concerns about the low amount of gas in storage revived the extreme volatility seen at the end of 2018 after the market slumbered for a couple of weeks at the start of the year when the weather was warmer than normal and utilities took a break from big inventory withdrawals.

Front-month gas futures for February delivery on the New York Mercantile Exchange were down 0.5 cents, or 0.1%, at $3.586 per million British thermal units at 9:22 a.m. EST (1422 GMT). On Jan. 14, the contract rose by 15.9%, its biggest daily percentage gain in eight weeks and its second biggest since 2010.

In recent days, the market has seen a return of the extreme volatility seen at the end of last year. The spread between the intraday high and low has topped 5% of the previous session’s close for three days in a row, including Jan. 15.

That compares with just one day during the first seven sessions of the new year, and 32 times during the last 35 sessions of 2018.

Traders said intense volatility late last year was due to a combination of changing weather forecasts and concerns about low stockpiles. But weeks of warmer-than-usual weather in December and early January allowed utilities to cut the vast storage deficit from 21% a few weeks ago to just 15% now by leaving more fuel in underground storage facilities.

But if cold weather materializes later in January, traders said utilities will start pulling massive amounts of gas out of storage again to meet rising heating demand.

With less cold expected next week, Refinitiv projected demand for gas in the Lower 48 states would fall to 124.7 billion cubic feet per day (Bcf/d), down from a forecast 125.9 Bcf/d on Jan. 14. That compares with an expected 116.4 Bcf/d this week.

Analysts said utilities likely pulled a smaller-than-normal 71 billion cubic feet of gas from inventories during the warm week ended Jan. 11. That compares with declines of 208 bcf during the same week last year and a five-year average decrease of 218 bcf for the period.

If correct, the withdrawal for the week ended Jan. 11 would cut stockpiles to 2.543 trillion cubic feet, 11.1% below the five-year average of 2.860 tcf for this time of year and the lowest for the week since 2014.

Gas output in the Lower 48 has averaged near a record high of 86.9 Bcf/d over the past 30 days. On a daily basis, production eased to 87.0 Bcf/d on Jan. 14 a recent high of 87.4 Bcf/d on Jan. 11, according to Refinitiv data.

That is well short of the all-time daily output high of 88.8 Bcf/d on Nov. 30.