Natural gas for August delivery fell 9 cents, or 3.1%, to recently trade at $2.784 a million British thermal units on the New York Mercantile Exchange, after trading as high as $2.915/MMBtu earlier in the session.

Futures fell after failing to hold above the $2.90 level, retreating back to the 200-day moving average of $2.79/MMBtu that has served as a center of gravity in recent days.

Forecasts are calling for warmer temperatures across the U.S., but Matt Smith, analyst at Summit Energy, said hot weather "is being taken for granted" by investors.

"We were rallying first thing this morning because the weather outlooks have been leaning towards the bullish side. But when we get to nosebleed territory, near $3, there are concerns about falling demand," said Mr. Smith. "We're very much range-bound at the moment."