Nymex natural gas prices closed up by 3.20% on Wednesday, hitting a nearly 3-year high due to colder weather forecasts in the US boosting heating demand.

US dry gas production and demand were up by 6.4% and 2.6% year-over-year, respectively, while LNG net flows to US terminals decreased by 4.9% week-over-week.

Higher US electricity output is supporting gas prices, but increased nat-gas production remains a bearish factor for prices.

Weekly EIA nat-gas inventories are expected to decline by 18 bcf, following a larger-than-expected draw the previous week.

Active US nat-gas drilling rigs rose to a 2.25-year high, signaling increased production despite bullish inventory reports and adequate supplies.

Read more at Yahoo Finance: Cold US Temps Spark Fund Buying of Nat-Gas Futures