By Reg Curren Aug. 7 (Bloomberg) -- Natural gas futures may fall as mild weather and a sluggish economy keep demand for the industrial and power-plant fuel in check, a Bloomberg News survey showed. Nine of 18 analysts in the survey, or 50 percent, said prices will drop through Aug. 14. Seven, or 39 percent, said gas will advance. Two others predicted little change. Last week, 41 percent of participants said gas futures would decline. “The ultimate factor is the economy and that is still a big, gigantic question mark,” said Brad Florer, a trader for Kottke Associates Inc., a commodity futures broker in Louisville, Kentucky. “There could be a lot of gas out there with nowhere to put it as storage continues to fill up and weather remains mild.” Inventories gained 66 billion cubic feet in the week ended July 31 to 3.089 trillion cubic feet, the Energy Department said yesterday. It was the highest amount in storage at the end of July since the government began publishing weekly reports in 1994. Supplies were 19 percent above the five-year average. The National Oceanic and Atmospheric Administration yesterday cut the number of Atlantic hurricanes it expects this year to a range of three to six. In May, NOAA predicted a “near-normal” 2009 Atlantic season with four to seven hurricanes. The storms can disrupt the flow of supplies from offshore platforms in the Gulf of Mexico. Mild weather has limited air conditioning demand in the Midwest and Northeast, lowering electricity consumption. Power output in the U.S. fell 3.3 percent in the week ended July 30 from a year earlier, according to Genscape Inc. Gas consumption at factories is forecast to tumble 8.2 percent this year because of the recession, the Energy Department said July 7. Overall U.S. consumption is forecast to contract 2.3 percent. Natural gas futures for September delivery rose 9 cents, or 2.5 percent, to $3.743 per million British thermal units this week through yesterday on the New York Mercantile Exchange. Gas is down 33 percent this year. 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 7 9 2 To contact the reporter on this story: Reg Curren in Calgary at rcurren@bloomberg.net

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