By Reg Curren Jan. 6 (Bloomberg) -- Natural gas futures rose in New York as cold weather across most of the U.S. lifted demand for heating fuel and helped to reduce a surplus. Temperatures in St. Louis, Memphis and Dallas will be below normal for the next week, according to a forecast from MDA Federal Inc.’s EarthSat Energy Weather. Cold weather in recent weeks cut a stockpile surplus to 14 percent for the week ended Dec. 25 from 16 percent at the start of the month. “Storage is going from materially oversupplied to more manageable inventory levels,” said Tom Orr, director of research at Weeden & Co., a brokerage in Greenwich, Connecticut. “It looks like it’s going to continue to be pretty cold here.” Natural gas for February delivery advanced 29.7 cents, or 5.3 percent, to $5.934 per million British thermal units at 10:09 a.m. on the New York Mercantile Exchange. The contract declined 4.2 percent yesterday on forecasts of milder weather in parts of the Midwest and Northeast late next week. The Energy Department may say tomorrow that U.S. stockpiles dropped 146 billion cubic feet last week, based on the median of 10 analyst estimates compiled by Bloomberg. The “seasonal norm” withdrawal is 83 billion, Scott Speaker, JPMorgan Chase & Co.’s natural gas strategist in New York, said in a note to clients yesterday. “We see a net withdrawal of 144 billion cubic feet, a draw that would significantly tighten the current year-over-year surplus and the surplus compared to the past five-year average,” he said. Stockpiles were 513 billion cubic feet above the five-year average for the week ended Dec. 4, the Energy Department reported. The surplus dropped to 391 billion by Dec. 25. Demand in the current week, which is being pushed higher by frigid weather and a return of industrial demand after the Christmas to New Year holiday, may produce a withdrawal of more than 200 billion cubic feet from storage, Speaker said. The overnight low in St. Louis may dip to minus 2 Fahrenheit (minus 19 Celsius) on Jan. 9, with a daytime high of 10 degrees, EarthSat Energy Weather of Rockville, Maryland, said in its report. The typical low for the day is 21 degrees with a high of 37, according to National Weather Service data. Dallas may see a low of 12 degrees on Jan. 9, EarthSat said. The normal low is 34 degrees. To contact the reporter on this story: Reg Curren in Calgary at rcurren@bloomberg.net

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