By Mark Peters Of DOW JONES NEWSWIRES NEW YORK (Dow Jones)--Natural gas futures fluctuated Monday as an uptick in demand from hot weather was at odds with ongoing ample supplies. Natural gas for August delivery on the New York Mercantile Exchange was trading 1.9 cents, or 0.42%, lower at $4.50 a million British thermal units. Analysts said prices appear stuck between downward pressure from robust supplies and production and hotter-than-normal temperatures across the U.S. That's likely to keep futures from making too much of a move in either direction, said Gene McGillian, an analyst with Tradition Energy, who projects prices will stay between $4.40/MMBtu and $4.80/MMBtu in the near term. "Anyone looking for excitement in this market can take most of the week off," Jim Ritterbusch, president of the energy advisory firm Ritterbusch and Associates, wrote in a note to clients. U.S. gas supplies and production levels remain strong, likely keeping prices from climbing dramatically even as hot weather increases gas demand. Many parts of the country use gas-fired power plants to meet spikes in electricity demand during hot weather. Gas in U.S. storage as of July 9 totaled 2.84 trillion cubic feet, about 10.7% above the five-year average for the same week and 1.1% below last year's level for that week. At the same time, the number of drilling rigs continues to climb as producers tap onshore shale-rock formations across the U.S. Yet analysts expect hot weather in the near term to put a floor on prices. Much of the U.S. is experiencing hot temperatures Monday, and the National Weather Service is forecasting the heat to continue. Its forecast for July 24 through July 28 predicts hotter-than-normal temperatures for most of the U.S. "I think there is limited downside," said Ed Kennedy, a senior vice president of energy trading with Hencorp Becstone Futures in Miami. -By Mark Peters, Dow Jones Newswires; 212-416-2457; mark.peters@dowjones.com

Source