Investing.com - Natural gas futures fell on Tuesday after updated weather-forecasting models scaled back on the reach and intensity of several cold snaps set to make their way across the U.S.
On the New York Mercantile Exchange, natural gas futures for delivery in January were down 2.10% at $3.641 per million British thermal units during U.S. trading. The commodity hit a session low of $3.629, and a high of $3.789.
The January contract settled down 2.00% on Monday to end at $3.719 per million British thermal units.
Natural gas futures were likely to find support at $3.606 per million British thermal units, last Wednesday's low, and resistance at $3.936, Monday's high.
While some portions of the northern U.S. will see colder weather in the coming days, mild temperatures could hover over a broader chunk of the central and southern reaches of the country than once expected, which should cut into demand for heating.
"A weather system will continue sweeping through the Great Lakes and into the eastern US over the next few days with areas of rain, snow, and cooler temperatures. The southern US will remain quite mild as high pressure dominates with highs mainly in the upper 50s to lower 70s," Natgasweather.com reported in its Dec.16-22 weather forecast summary.
After that time period, a blast of cold air will make its way east, though the extent of the system's reach remains up in the air, which allowed natural gas prices to slide on Tuesday.
"A strong weather system will track across the central and eastern US Christmas Eve with areas of rain and accumulating snow. How much cold Canadian air the system taps will need refining in the days ahead," Natgasweather.com reported in its Dec. 23-28 weather forecast summary.
"Additional colder weather systems are likely to follow through the rest of the year, especially over the north-central and eastern US. The West Coast will be dry with high pressure dominating, although the interior West could be quite chilly with Canadian air also pushing through."
Investors were looking ahead to the weekly inventory report from the Energy Information Administration as they continued to digest last Thursday’s bullish report.
Natural gas storage fell by 51 billion cubic feet in the week ended Dec. 5, more than expectations for a decline of 45 billion.
Total U.S. natural gas storage stood at 3.359 trillion cubic feet. Stocks were 186 billion cubic feet less than last year at this time and 351 billion cubic feet below the five-year average of 3.710 trillion cubic feet for this time of year.
Approximately 49% of U.S. households use gas for heating, according to the EIA, the statistical arm of the Energy Department.
Elsewhere on the NYMEX, light sweet crude oil futures for delivery in February were down 0.58% at $55.94 a barrel, while heating oil for January delivery were down 2.60% at $1.9498 per gallon.