Adds comment and closing price

By Rahul Paswan and Brijesh Patel

Sept 17 (Reuters) -U.S. natural gas futures fell 2% on Tuesday after hitting amore than two-month high earlier in the session, as Gulf of Mexico producers slowly ramp up production after Hurricane Francine, easing concerns over supply and prompting some profit taking.

Front-month gas futures NGc1 for October delivery on the New York Mercantile Exchange fell 4.9 cents or 2% to settle at$2.324 permillion British thermal units (mmBtu).

"Now with the production coming online, the market is less concerned about tightening supply and that's been weighing the prices," said Phil Flynn, an analyst at Price Futures Group.

About 10% of natural gas output in the U.S. Gulf of Mexico was offline in the aftermath of Francine, the U.S. Bureau of Safety and Environmental Enforcement (BSEE) said on Tuesday. That is compared with 53% of natural gas output shut after the tropical storm barreled across the U.S. South last week.

Meanwhile, anatural gas liquid (NGL) pipeline owned by Energy Transfer ET.N caught fire in La Porte, Texas, on Monday morning, knocking out power to thousands of homes and businesses and prompting a widespread evacuation. The fire continues to burn itself out.

"The explosion in Houston/Deer Park was on a line carrying NGLs and although there is other gas infrastructure in the immediate area which are under force majeure or pressure reductions, we do not see it as impactful to forward markets," said Gary Cunningham, director of market research at Tradition Energy.

Financial firm LSEG estimated 134 cooling degree days (CDDs) over the next two weeks. The normal for this time of year is 94 CDDs. Meanwhile, LSEG forecast average gas demand in the Lower 48, including exports, to rise from 100.0 bcfd this week to 100.5 bcfd next week.

LSEG forecast average gas supply in the Lower 48, including exports, at 101.9 bcfd this week to 102.2 bcfd next week. LSEG said gas output in the Lower 48 U.S. states slid to an average of 102.1 billion cubic feet per day (bcfd) so far in September, down from 103.2 bcfd in August.

"Nearby futures are bumping up against resistance at the $2.42 level and are likely to push higher during the next couple of sessions as speculative shorts continue to exit or roll positions forward into the deferred contracts amid production slippage, steady LNG export activity, coal to gas switching and warmer than normal temperature forecasts into month’s end," energy advisory firm Ritterbusch and Associates said in a note.

Elsewhere, Dutch and British wholesale gas prices on Tuesday morning traded slightly higher after hitting seven week lows the previous day when milder weather curbed demand. NG/EU

U.S. liquefied natural gas (LNG) developer Venture Global LNG signed a five-year deal with Gastrade SA to regasify up to 1 million metric tons of LNG in Greece for a five-year period beginning next year from two of its Louisiana export facilities, the company said on Tuesday.

Reporting by Rahul Paswan and Brijesh Patel in Bengaluru; Editing by Louise Heavens

For gas data on the LSEG terminal 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 LSEG 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

NYMEX Henry Hub swaps options and futures combined 0#3CFTC03565B

NYMEX Henry Hub Penultimate gas swaps 0#3CFTC03565C