NEW YORK: US natural gas futures fell over 4% on Tuesday from a near 21-month high over the past few days on forecasts for milder weather and lower heating demand in mid November and a steady rise in output.

That price drop came despite an increase in liquefied natural gas (LNG) exports to a record high.

Front-month gas futures fell 14.5 cents, or 4.5%, to $3.099 per million British thermal units at 9:35 a.m. EST (1435 GMT). The contract closed at its highest since January 2019 on Friday and remained near that level on Monday.

The premium of gas futures for March over April 2021, meanwhile, dropped to a record low. Traders use the March-April spread, known as the widow maker, to bet on changes in winter weather.

Data provider Refinitiv said output in the Lower 48 US states rose to a seven-week high of 90.0 billion cubic feet per day (bcfd) on Monday, up 4.6 bcfd since Hurricane Zeta hit the Gulf Coast on Wednesday as energy firms restored output from Gulf of Mexico wells shut ahead of the storm.

Output averaged 89.3 bcfd so far in November, up from a five-month low of 87.4 bcfd in October. That, however, is still well below the all-time high of 95.4 bcfd in November 2019.—Reuters