By Scott DiSavino

July 23 (Reuters) -U.S. natural gas futures slid about 3% on Tuesday on rising output and an ongoing oversupply of gas in storage.

Analysts said there was still about 17% more gas in storage than normal for this time of year even though injections have been smaller than usual for nine of the past 10 weeks after several producers cut output earlier in the year when futures prices dropped to 3-1/2 year lows in February and March. EIA/GAS NGAS/POLL

Higher prices in April and May, however, prompted some drillers, including EQT EQT.N and Chesapeake Energy CHK.O, to boost output so far in June and July.

EQT is the nation's biggest gas producer and Chesapeake is on track to become the biggest after its planned merger with Southwestern Energy SWN.N. EQT, meanwhile, completed its roughly $14 billion acquisition of Equitrans, the pipeline company EQT spun off in 2018.

Front-month gas futures NGc1 for August delivery on the New York Mercantile Exchange fell 5.9 cents, or 2.6%, to $2.192 per million British thermal units at 9:12 a.m. EDT (1312 GMT).

That price increase came despite rising amounts of gas flowing to U.S. liquefied natural gas (LNG) export plants as Freeport LNG in Texas started exporting cargoes again after shutting for Hurricane Beryl in early July.

Another factor that was keeping the price decline in check were forecasts that the weather over much of the Lower 48 U.S. states would turn extremely hot in August. That should boost the amount of gas power generators burn to produce electricity to keep air conditioners humming.

In addition to the heat, power generators were also burning more gas because the amount of electricity coming from wind so far this week was much lower than usual.

Wind farms were on track to produce an average of just 4% of power generation this week, down from 7% last week, 12% so far in 2024 and 10% in 2023. Gas-fired power plants were producing an average of 48% of generation this week, up from 46% last week, 40% so far in 2024 and 41% in 2023.

SUPPLY AND DEMAND

Financial firm LSEG said gas output in the Lower 48 states rose to an average of 102.3 billion cubic feet per day (bcfd) so far in July, up from an average of 100.2 bcfd in June and a 17-month low of 99.4 bcfd in May.

U.S. output hit a monthly record high of 105.5 bcfd in December 2023.

Meteorologists projected weather across the Lower 48 would remain mostly near normal through July 27 before turning hotter than normal through at least Aug. 7.

With hotter weather coming, LSEG forecast average gas demand in the Lower 48, including exports, will rise from 104.8 bcfd this week to 106.1 bcfd next week. Those forecasts were similar to LSEG's outlook on Monday.

Gas flows to the seven big U.S. LNG export plants fell to 11.6 bcfd so far in July after Freeport shut before Hurricane Beryl hit the Texas Coast on July 8, down from 12.8 bcfd in June and a monthly record high of 14.7 bcfd in December 2023.

On a daily basis, however, LNG feedgas was on track to reach a two-week high of 12.6 bcfd on Tuesday as the 2.1-bcfd Freeport slowly returns to service.

Gas flows to Freeport, which started to exit a nine-day outage on July 16, held near 1.4 bcfd on Monday and Tuesday after the plant pulled in almost no gas from July 7-15.

Reporting by Scott DiSavino, Editing by Franklin Paul

For gas data on LSEG's Eikon type ENERGY in the search bar and then go to the GAS drop down and the NORTH AMERICA drop down.

For Interactive Map, type 'Interactive Map' in the box at upper left of the Eikon terminal

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

To determine CFTC managed money net position add (NYMEX Henry Hub options and futures combined 3023651MNET) plus (ICE Henry Hub options and futures combined 3023391MNET divided by four) plus (NYMEX Henry Hub swaps options and futures combined 303565BMNET divided by four) plus (NYMEX Henry Hub penultimate gas swaps 303565CMNET divided by four)

NYMEX Henry Hub options and futures combined 0#3CFTC023651

NYMEX Henry Hub futures only 0#1CFTC023651

ICE Henry Hub options and futures combined 0#3CFTC023391

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