Natural gas futures may climb next week as a hot start to summer drives demand from power plants to run air conditioners, a Bloomberg survey showed.
Five of 11 analysts, or 45 percent, predicted that futures will gain on the New York Mercantile Exchange through June 28. Four, or 36 percent, said gas will drop and two said prices will stay the same. Last week, 54 percent of participants said gas would advance.
Temperatures will above normal across most of the lower 48 states from June 25 through July 4, according to MDA Weather Services in Gaithersburg, Maryland. Gas prices fell yesterday for the first time in four days after a government report showed an above-average supply gain for the third consecutive week.
“We expect U.S. natural gas prices to continue to correct higher as the industry transitions into the peak cooling season,” Teri Viswanath, director of commodities strategy at BNP Paribas SA in New York, said in an e-mail yesterday. Hotter weather may push prices back above $4, she said.
Natural gas futures fell 8.6 cents, or 2.2 percent, to $3.877 per million British thermal units yesterday on the Nymex. Prices are up 3.9 percent this week, headed for the first gain in four weeks. The futures are up 16 percent this year.
The high in Dallas on June 28 may be 101 degrees (38 Celsius), 7 higher than the usual reading, according to AccuWeather Inc. in State College, Pennsylvania. Philadelphia’s high on July 1 may be 3 above normal at 89 degrees.
Power plants will account for 32 percent of U.S. gas consumption this year, according to the Energy Information Administration.
Gas inventories rose 91 billion cubic feet to 2.438 trillion in the week ended June 14, above the five-year average gain for the period of 80 billion, EIA data show.
The gas survey has correctly forecast the direction of prices 50 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 gas futures will probably rise, fall or remain neutral in the coming week. This week’s results were:
RISE FALL NEUTRAL
5 4 2
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