Natural gas futures may climb next week as hotter weather boosts demand for the power-plant fuel, a Bloomberg survey showed.
Seven of 14 analysts, or 50 percent, predicted that futures will advance on the New York Mercantile Exchange through July 19. Six, or 43 percent, said gas will decline and one predicted prices will stay the same. Last week, 42 percent of participants said gas would fall.
Temperatures will be above-normal across most of the lower 48 states next week, according to MDA Weather Services in Gaithersburg, Maryland. Gas prices have slumped 19 percent from a 21-month high reached on May 1 as stockpile gains topped five-year averages for six consecutive weeks amid mild weather.
“We see prices moving marginally higher as rising air-conditioning demand provides increased competition with storage injections,” Teri Viswanath, director of commodities strategy at BNP Paribas SA in New York, said in an e-mail yesterday.
Natural gas futures slipped 0.4 cent, or 0.1 percent, to $3.613 per million British thermal units during the first four days of this week on the Nymex. The futures are up 7.8 percent this year.
The temperature in Washington on July 17 may rise to 94 degrees Fahrenheit (34 Celsius), 5 above the usual high, and Cleveland may be 7 degrees above normal at 89, according to AccuWeather Inc. in State College, Pennsylvania.
Power plants will account for 32 percent of U.S. gas consumption this year and are the biggest users of the fuel in the lower 48 states, said the Energy Information Administration, the Energy Department’s statistical arm.
U.S. gas stockpiles increased 82 billion cubic feet to 2.687 trillion in the week ended July 5, above the five-year average gain for the period of 74 billion, according to an EIA report yesterday.
A deficit to the average narrowed for a sixth week, dropping to 0.8 percent from 1.1 percent the previous period. Supplies were 14.2 percent below levels a year earlier, the smallest year-on-year spread since Feb. 22.
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
7 6 1
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