Natural gas futures may rise as below-normal temperatures increase heating demand, a Bloomberg News survey showed.
Ten of 22 analysts, or 45 percent, forecast that gas prices will climb on the New York Mercantile Exchange through Dec. 10. Nine, or 41 percent, said futures will fall and three predicted that prices will stay the same. Last week, 50 percent of participants said gas would increase.
Colder weather is likely in the Northeast, Southeast and Midwest from Dec. 7 through Dec. 16, according to Commodity Weather Group in Bethesda, Maryland. Heating demand from Dec. 8 through Dec. 12 may be 15 percent above normal levels, according to David Salmon, a meteorologist with Weather Derivatives in Belton, Missouri.
“We seem to have put a bottom in place; temperatures are dropping and the economy seems to be gradually rambling towards a better place,” said Peter Beutel, the president of Cameron Hanover Inc., an energy advisory company in New Canaan, Connecticut. “The bearish factors were discounted many moons ago.”
Natural gas for December delivery fell 5.6 cents, or 1.3 percent, to settle at 4.343 per million British thermal units in the first four days of trading this week on the New York exchange.
The low temperature in New York on Dec. 11 may be 26 degrees Fahrenheit (minus 3 Celsius), 5 degrees below normal, according to AccuWeather Inc. in State College, Pennsylvania. The low in Chicago may be 17 Fahrenheit, 7 degrees below normal.
The gas survey has correctly forecast the direction of prices 48 percent of the time since its June 2004 introduction.
Bloomberg’s survey of natural-gas analysts and traders asks for an assessment of whether Nymex natural-gas futures will probably rise, fall or remain neutral in the coming week. This week’s results were:
RISE FALL NEUTRAL
10 9 3
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