A floor crew pull steel pipe out of a natural gas well in the Barnett Shale of Fort Worth, Texas that is owned by Chesapeake Energy Corporation. Robert Nickelsberg | Getty Images

Natural gas prices fell sharply Monday, as weather forecasts for February show more normal and even warmer-than-normal temperatures for parts of the U.S., following a brutal cold snap this week. Natural gas futures for February fell 7.2 percent to $2.95 per million British thermal units.

"The forecast tuned a little milder for next week, and they took the bottom out of the market again. The storage picture has been altered a bit, and there really are no worries. If February doesn't turn out to be the coldest month of winter, justifying a plus $3 price is hard for the market," said Gene McGillian, manager market research at Tradition Energy.

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Source: NOAA The market has been volatile this winter with worries about low amounts of gas in storage, but high levels of production have helped alleviate that concern. "Last week was the first week compared to a year ago that we flipped to a small surplus for the first time in about 18 months," McGillian said. Inventories still remain below the five-year average.

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