Natural gas futures may fall as milder weather reduces demand and as gas supplies will be ample to meet consumption, a Bloomberg News survey showed.

Seven of 15 analysts, or 47 percent, said gas futures on the New York Mercantile Exchange will decline through July 16. Five, or 33 percent, said gas will rise and three said there would be little change in price. Last week, 64 percent of participants said prices would rise.

“The hot weather will start to dissipate and there is really nothing that would act as a catalyst to get gas moving,” said an energy analyst at RBC Capital Markets in Minneapolis.

Cooler air bringing rain and thunderstorms is expected to move through New York this weekend, according to the National Weather Service. New York broke daily temperature records and reached above 100 degrees for two days in a row for the first time since 1999. Central Park posted 100 degrees on June 7 and 103 on June 6.

Natural gas for August delivery on the New York exchange dropped 28.5 cents, or 6.1 percent, to $4.402 per million British thermal units this week.

“A well-supplied market is keeping a lid on prices even as temperatures, and power loads, are setting records in the densely populated Northeast this week,” an analyst at Barclays Capital in New York, said in a note to clients yesterday.

Production Forecast

The Energy Department on July 7 raised its forecast for U.S. natural gas production this year, as increasing onshore output offsets an expected decline in offshore production.

U.S. production will average 61.26 billion cubic feet a day this year, up from 61.22 billion estimated in June. Gas output will rise 2.1 percent from 2009.

Gas stockpiles gained 78 billion cubic feet in the week ended July 2 to 2.762 trillion, the Energy Department said yesterday. Analysts surveyed by Bloomberg expected an increase of 70 billion. A deficit to year-earlier supplies narrowed to 0.8 percent from 1 percent in the previous week.

“Because you are not seeing a big impact to the storage injection numbers from this hot weather, it disappointed people and the outlook started to moderate again,” Hanold said.