U.S. natural gas futures fell to the lowest level since March on Tuesday, as forecasts for below-normal temperatures across most parts of the U.S. over the next two weeks weighed.
U.S. natural gas for July delivery was at $2.939 per million British thermal units by 9:35 AM ET (13:35 GMT), down 2.8 cents, or around 1%. It fell to its lowest since March 20 at $2.916 earlier.
Prices of the fuel notched a second straight decline on Tuesday.
Updated weather forecasting models showed that cooling will fan out across the northern and east central U.S. this weekend into early next week.
Looking further out, the east-central U.S., including the Northeast will be near to slightly cooler than normal from June 20-27, as weather systems track through.
Natural gas prices have closely tracked weather forecasts in recent weeks, as traders try to gauge the impact of shifting outlooks on spring heating demand.
Gas use typically hits a seasonal low with spring's mild temperatures, before warmer weather increases demand for gas-fired electricity generation to power air conditioning.
Nearly 50% of all U.S. households use gas for heating.
Total natural gas in storage currently stands at 2.631 trillion cubic feet, according to the U.S. Energy Information Administration, 11.2% lower than levels at this time a year ago but 9.0% above the five-year average for this time of year.
Market participants looked ahead to weekly storage data due on Thursday, which is expected to show a build in a range between 79 and 89 billion cubic feet in the week ended June 9.
That compares with a gain of 106 billion cubic feet in the preceding week, an increase of 69 billion a year earlier and a five-year average rise of 87 billion cubic feet.