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NEW YORK: US natural gas futures slipped from a more than three-week high on Tuesday on forecasts for milder weather and less heating demand over the next two weeks than previously expected.

On their second to last trading day as the front-month, gas futures fell 8.5 cents, or 2.2%, to $3.972 per million British thermal units (mmBtu) by 9:32 am EST (1432 GMT), after rising nearly 9% in the last session.

“Natural gas prices continue to flip flop on concerns about weather. When the forecast turns a little colder, the market rallies and when we turn a little bit warmer like today, the market goes back down,” said Phil Flynn, senior analyst at Price Futures Group in Chicago.

“Also, we have to look the futures expiration for the January natural gas contract which could provide some real volatility in the market. The weather is holding us back, but our expectation is that as soon as winter hits, we think the market is going to be well supported.”

Data provider Refinitiv estimated 419 heating degree days (HDDs) over the next two weeks in the Lower 48 US states, slightly lower from the 420 HDDs estimated on Monday. The normal is 438 HDDs for this time of year.

HDDs, used to estimate demand to heat homes and businesses, measure the number of degrees a day’s average temperature is below 65 Fahrenheit (18 Celsius).

Refinitiv projected average US gas demand, including exports, would jump from 108.8 billion cubic feet per day (bcfd) this week to 123.9 bcfd next week as the weather turns seasonally colder. Those forecasts were lower than Refinitiv’s outlook on Monday.

In recent months, global gas prices hit record highs as utilities around the world scrambled for LNG cargoes to replenish low stockpiles in Europe and meet insatiable demand in Asia, where energy shortfalls have caused power blackouts in China.

The amount of gas flowing to US LNG export plants has averaged 11.9 bcfd so far in December, now the sixth train at Cheniere Energy Inc’s Sabine Pass plant in Louisiana is producing LNG. That compares with 11.4 bcfd in November and a monthly record of 11.5 bcfd in April.

Output in the US Lower 48 has averaged 97.0 billion cubic feet per day (bcfd) so far in December, which would top the monthly record of 96.5 bcfd in November.

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