Natural gas futures rallied in early trading Tuesday as updated forecasts ratcheted up cooling demand expectations, though analysts continued to characterize the underlying fundamental outlook as bearish.

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The August Nymex contract was up 6.3 cents to $2.575/MMBtu at around 8:30 a.m. ET.

Weather models trended hotter overnight, including a “hefty” 9 cooling degree day increase in the American dataset, according to NatGasWeather.

The projected cooling demand gains were focused in the 10- to 15-day time frame and thus should be regarded with some skepticism, according to the firm.

“As we’ve witnessed all summer, impressive heat” projected for days further out in the forecast “consistently trends cooler” once those days move into the three- to nine-day time...