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CHICAGO: US natural gas futures fell on Tuesday as weather forecasts turned milder than before, potentially dimming demand for the fuel used to cool homes and businesses.

Front-month gas futures slipped 10 cents, or 2.6%, to $3.846 per million British thermal units (mmBtu) by 10:06 a.m. EDT (1406 GMT).

Data provider Refinitiv projected average US gas demand, including exports, would rise from 92 billion cubic feet per day (bcfd) this week to 93 bcfd next week.

Refinitiv also said gas output in the US Lower 48 states averaged 92 bcfd so far in August, up from 91.6 bcfd in July. That compares with an all-time high of 95.4 bcfd in November 2019.

"The market is starting to expect a more appreciable production response later this year with the recent completion of the Whistler pipeline in Texas providing a boost to supplies," said Daniel Myers, market analyst at Gelber & Associates in Houston, noting that milder weather forecasts and the rebound in supply was weighing on prices.

The amount of gas flowing to US LNG export plants is expected to jump to 11 bcfd in the next two weeks.

"Margins are very robust and that should continue to inspire as much LNG shipments from the US as we can export," supporting the market, Myers added.

At over $16 per mmBtu, European and Asian gas prices are about four times higher than the US fuel. Prices at the Title Transfer Facility (TTF) in the Netherlands, the European benchmark, hit a record peak on Monda.

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