US natural gas futures jump on colder weather

US natural gas futures rose on Tuesday, posting their biggest daily percentage gain in more than a month on forecasts for a cold spell by mid-December that could boost heating demand.

Front-month gas futures for January delivery on the New York Mercantile Exchange rose 11.2 cents, or 4.8%, to settle at $2.441 per million British thermal units.

"Weather forecasts are back to being cold again... There appears to be some risk on the table for the cold blast that they canceled a few weeks earlier, now could be coming back in play," said Phil Flynn, senior analyst at Price Futures Group in Chicago. With frigid weather on the way, data provider Refinitiv projected average gas demand in the US Lower 48 states, including exports, would rise to 123 billion cubic feet per day (bcfd) next week from 116.1 bcfd this week. That tops Refinitiv's estimates on Monday of 120.3 bcfd for next week and 116.3 bcfd for this week.

Refinitiv data indicates 426 heating degree days (HDDs) in the Lower 48 US states over the next two weeks. The normal is 400 HDDs for this time of year.

HDDs measure the number of degrees a day's average temperature is below 65 degrees Fahrenheit (18 degrees Celsius).