Natural gas futures slumped Wednesday as falling cooling demand and signs of increasing U.S. gas inventories prompted traders to abandon gains made earlier this week.

Natural gas for October delivery fell 3.4 cents, or 0.9%, at $3.793 a million British thermal units on the New York Mercantile Exchange. The benchmark contract saw light trading ahead of its expiration at settlement Wednesday.

The November contract was recently down 2.6 cents to $3.849 mm/btu.

After rising more than 12 cents in the past two trading sessions, gas futures fell as temperatures throughout the U.S. began to moderate in what is know as the "shoulder season," the period between peak demand for air conditioning and heating.

Analysts expect that the lull may translate to the first triple-digit injection of natural gas this season.

"We've had a couple of days of rallying despite weather not giving much direction," said Matt Smith, analyst with Summit Energy. "Supply remains so strong, we're still near record production levels, and it's the low point in demand."

High output levels combined with mild weather are keeping prices well below the $4 mm/btu level reached earlier in September, when storms temporarily halted some production in the Gulf of Mexico.

The National Hurricane Center is tracking Tropical Depression Ophelia, which is expected to reform into a tropical storm later Wednesday as it swirls east of the Leeward Islands. But Ophelia, and Tropical Storm Phillipe, located farther east in the Atlantic, are both expected to turn north and pose little threat to Gulf production.