Adds latest prices

By Scott DiSavino

May 13 (Reuters) - U.S. natural gas futures held steady on Tuesday as a drop in output in recent weeks offset forecasts for lower demand over the next two weeks than previously expected.

That expected demand decline was due in part to lower gas flows to liquefied natural gas export plants during the spring maintenance season.

Gas futures NGc1 for June delivery on the New York Mercantile Exchange rose 0.1 cents to settle at $3.647 per million British thermal units.

Analysts said mostly mild weather in coming weeks should keep heating and cooling demand low, allowing utilities to continue injecting more gas into storage than normal for this time of year.

Gas stockpiles are about 3% above the five-year (2020-2024) normal. EIA/GAS GAS/POLL

Looking ahead, analysts said the roughly 11% drop in U.S. crude futures CLc1 so far in 2025 should prompt drillers to cut back on oil production.

Any decline in oil production would also reduce the amount of gas pulled out of the ground that is associated with that oil output. About 37% of U.S. gas production comes from associated gas, according to federal energy data.

Over time, analysts said any reduction in associated gas output should increase gas prices.

SUPPLY AND DEMAND

Financial firm LSEG said average gas output in the Lower 48 U.S. states fell to 103.7 billion cubic feet per day so far in May, down from a monthly record of 105.8 bcfd in April.

On a daily basis, gas output was on track to drop from a record 107.4 bcfd on April 18 to a preliminary 11-week low of 102.2 bcfd on Tuesday. Analysts have noted that preliminary data is often revised later in the day.

Meteorologists projected temperatures in the Lower 48 states would remain mostly warmer than normal through May 28.

AccuWeather meteorologists forecast high temperatures in Houston, the biggest city in Texas, would reach 94 degrees F (34.4 Celsius) on Tuesday, breaking the record May 13 high of 92 F set in 2011, and would keep topping 90 F every day from May 13-26. The normal high in the city for this time of year is 86 F.

With warmer weather starting to boost air conditioning use in some parts of the country, like Texas, LSEG forecast average gas demand in the Lower 48, including exports, will rise from 96.4 bcfd this week to 97.4 bcfd next week. Those forecasts were lower than LSEG's outlook on Monday.

The average amount of gas flowing to the eight big LNG export plants operating in the U.S. fell to 15.1 bcfd so far in May, down from a monthly record of 16.0 bcfd in April.

The LNG feedgas decline so far this month was mostly due to reductions for maintenance at Cameron LNG's 2.0-bcfd plant in Louisiana and Cheniere Energy's LNG.N 3.9-bcfd Corpus Christi plant under construction and in operation in Texas, and a one-day outage at Freeport LNG's 2.1-bcfd plant in Texas on May 6.

LNG gas flows to Corpus were on track to drop to a two-month low of 1.5 bcfd on Tuesday, down from 1.9 bcfd on Monday and an average of 2.0 bcfd during the prior seven days, according to LSEG data.

(Reporting by Scott DiSavino; Editing by Andrea Ricci and Nia Williams)

((scott.disavino@thomsonreuters.com; +1 332 219 1922; Reuters Messaging: scott.disavino.thomsonreuters.com@reuters.net))

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For graphics on Baker Hughes rig counts, see: http://graphics.thomsonreuters.com/15/rigcount/index.html

For next-day SNL U.S. gas prices, see: 0#SNL-NG

For next-day SNL U.S. power prices, see: 0#SNL-PWR

For U.S. natgas price and storage polls, see: NGAS/POLL

For U.S. nuclear power outages, see: NUKE/

For U.S. Northwest hydro power report, see: NWRFC

For U.S./Canada natural gas rig count vs Henry Hub futures price, see: http://tmsnrt.rs/2eT9k44

For the U.S. natural gas speed guide, see: USGAS

For the U.S. power speed guide, see: USPOWER

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