Warm outlook backs U.S. natgas futures gains for 2nd day1 hour ago by Thomson Reuters

* U.S. Northeast and Midwest expect hotter temperatures    * Outlook for Texas and the South still fairly mild    * Coming up: Reuters natgas storage poll on Wednesday    By Joe Silha    NEW YORK, June 18 (Reuters) - U.S. natural gas futures heldgains on Tuesday for a second straight day, underpinned byhotter weather forecasts for the Northeast and Midwest thatshould force more homeowners and businesses to crank up theirair conditioners.    Mild late-spring weather pressured front-month gas futuresdown nearly 12 percent in the last three weeks, the biggestthree-week slide for the nearby contract in six months.    But with heat now forecast for northern tier states laterthis week and next week, gas prices are up nearly 6 percent sofar this week, with more gains possible if the forecast holds.    "There may be enough cooling demand now to keep a floorunder prices ... although we remain concerned about downsiderisk over the intermediate term once the heat passes," CitiFutures energy analyst Tim Evans said in a report.    At 11:45 a.m. EDT (1545 GMT), front-month gas futures on the New York Mercantile Exchange were up 6.9 cents, or 1.8percent, at $3.944 per million British thermal units aftertrading between $3.873 and $3.952. The front month brieflydipped to a three-month low of $3.71 last Wednesday.    The U.S. National Hurricane Center said Tropical DepressionTwo was expected to move over the Bay of Campeche in thesouthwest Gulf of Mexico on Wednesday. Traders do not expect thesystem to disrupt any U.S. oil or gas production in the Gulf.    Separately, a section of the Florida Gas Transmission'snatural gas pipeline in Louisiana was shut after an explosion onTuesday. There were no injuries reported, and the incident wasnot expected to disrupt shipments to customers.     Commodity Weather Group noted that computer models turned abit warmer this morning for the Midwest and East in the next sixto 10 days, but the private forecaster still sees seasonalreadings for Texas and the South during the period.    Many traders remained skeptical of the upside, withinventories at comfortable levels and production still flowingat or near a record high.    While the Baker Hughes gas drilling rig count isstill hovering just above the 18-year low of 350 hit five weeksago, U.S. gas production has not slowed much, if at all fromlast year's record high.    The Energy