By Geoffrey Smith
July 28 (Bloomberg) -- Natural gas rose for the fourth day this week as a hot weather trend was predicted to extend into the beginning of August across much of the U.S.
Gas inventories had an unprecedented summertime decline last week after soaring temperatures boosted power-plant demand for the fuel to run air conditioners. Stockpiles are typically added to from April to November to help meet demand in winter. Above- average temperatures will linger into next week in the West, Midwest and Northeast, forecasters said.
``The prices that you're looking at are reflecting the weather, the storms and the possibility of production disruptions,'' said Michael Rose, trading director at Angus Jackson Inc. in Fort Lauderdale, Florida, referring to the increasing likelihood of hurricane formation in August and September.
Gas for September delivery rose 6.1 cents, or 0.9 percent, to $7.184 per million British thermal units on the New York Mercantile Exchange. The price reached a peak of $7.29 and a low of $6.95 in a seesaw session. The benchmark contract has surged 29 percent in the past week and a half.
Last week's inventory draw was the first ever to occur between the months of May through September, according to Bill Trapmann, senior natural-gas researcher at the Energy Department. The government has been tracking inventory fluctuations since 1994.
The drop reduced total U.S. supplies to 2.756 trillion cubic feet, cutting the surplus against the five-year average to 22 percent from 26 percent a week earlier.
Chicago, New York City
Chicago's high temperatures will average 94 degrees Fahrenheit (34 Celsius) today through Aug. 1, 10 degrees higher than normal, according to the National Weather Service. Peak readings in Dallas will touch 99 degrees on average over that period, topping the seasonal norm of 96.
New York City's highs will average 91 Fahrenheit today through Aug. 1, topping the 85 degree average high for this time of year.
``The demand for cooling in the major metro areas of the Midwest and Northeast will be high this weekend,'' said John Dee, a meteorologist at Global Weather Monitoring in Lake Linden, Michigan. ``The western U.S. will see temperatures remain 3 to 8 degrees above average in all but the Pacific Northwest through the weekend.''
Power demand peaks in summer as people crank air conditioners. High temperatures mean increased cooling use and higher demand for electricity from gas-fired power plants.
As many as 10 hurricanes are forecast to form this year in the Atlantic, according to an outlook from government forecasters at the National Oceanic and Atmospheric Administration. The season, which started June 1 and lasts through November, typically peaks in August and September. So far two tropical storms have formed and no hurricanes.
To contact the reporter on this story: Geoffrey Smith in New York at gsmith15@bloomberg.net.
Last Updated: July 28, 2006 15:07 EDT
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