After further milder trends in the forecasts, and with January shaping up to be historically warm, natural gas futures crashed through the $2/MMBtu barrier over the long holiday weekend. At around 8:30 a.m. ET Tuesday, the February Nymex contract was trading at $1.944, off 5.9 cents from Friday’s settle.

Recent forecasts have acted like a “broken record,” repeatedly moving in the warmer direction, and the latest guidance early Tuesday was no different, according to Bespoke Weather Services. With “still just no cold air of note in this pattern,” the forecaster dropped 10 gas-weighted degree days from its 15-day outlook.

“The next two weeks will be characterized by a very El Nino-like pattern with no blocking in the high latitudes, a combination which results in very warm conditions for most of the nation outside of the South,” Bespoke said. “Any troughs/storms passing through in the pattern are unable to make a connection with colder air.

“The end result is a January which is projected to rank as the third warmest in our historical dataset, which comes on the heels of a top 10 warm December.”

The “much warmer” outlook from the major weather models over the weekend has dashed any expectations for a shift to cooler-than-normal temperatures starting this week, according to analysts at EBW Analytics Group.

From Wednesday through the first week of February, “weather-driven demand for natural gas is expected to be nearly 90 Bcf below normal, putting intense downward pressure on cash prices and keeping the amount of gas in storage far above usual levels,” the EBW analysts said. “At the same time, U.S. gas production has continued to decline. There are also hints that normal weather could return” later next month.

“With blowtorch warmth expected for at least two weeks, however, gas prices at Henry Hub are likely to fall to record lows, pushing the February contract into the $1.80s or lower and setting the stage for even steeper price declines later this winter.”

Looking at the supply picture, Genscape Inc. estimates showed Lower 48 dry gas production tracking toward a second straight month/month decline after averaging about 93.44 Bcf/d over the Martin Luther King Jr. Day weekend.

“That slightly trailed the month-to-date average heading into the weekend by 0.57 Bcf/d,” Genscape senior natural gas analyst Rick Margolin said. “It is also nearly 2.44 Bcf/d below the winter-to-date and all-time daily high of 95.88 Bcf/d printed back on Nov. 30. Since Nov. 30, production has been recording an average daily decline of 45 MMcf/d.”

February crude oil futures were trading 73 cents lower at $57.81/bbl shortly after 8:30 a.m. ET, while February RBOB gasoline was off about 2.1 cents to $1.6200/gal.