Your blood, muscles and liver store a certain amount of sugar. This is the most accessible form of energy storage so it is where your muscles consume energy from first. As you start exercising your blood sugar levels start to drop. But you only have a limited amount of sugar stored in this way. After exercising for over an hour these sugar levels are too low, you can actually feel this happening as your muscles stop obeying what you tell them to do as they do not have any more energy. If you train for lower intensity however your muscles will be able to burn fat. You can go on for much longer by burning fat as you have days of stored fat in your body and just an hour or so of stored sugar. By lowering the intensity of the exercise and do it in longer sessions you are able to burn more fat instead of sugar.
What exactly this does to weight reduction is not quite obvious. For one you will not get as tired and hungry after exercising as your blood sugar is closer to normal. It is also easier to do these longer low intensity exercises then short high intensity ones. You my even end up cycling for most of a weekend for fun or take a cycling holiday, which is hard if you have only done high intensity exercise.
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