-- Futures turn lower after spending morning higher -- Attention returns to mild winter, elevated inventories -- Sell-off puts futures on track for another 10-year low By Dan Strumpf Of DOW JONES NEWSWIRES NEW YORK (Dow Jones)--Natural gas futures turned lower Wednesday, wiping out earlier gains and extending a recent selling spree that puts the market on track to finish at another 10-year low. Natural gas for February delivery recently fell 1.2 cents, or 0.5%, to $2.476 a million British thermal units on the New York Mercantile Exchange. Futures had spent much of the morning in positive territory, trading as high as $2.542/MMBtu, as buying interest returned following a six-day sell-off. But the market reversed course as attention returned to the mild temperatures that have curbed demand for gas-fired heating in the U.S. this winter. Traders were also bracing for a report from the U.S. Department of Energy due Thursday that's expected to show another modest decline in natural gas inventories, underscoring the weak demand and the relentless pace of natural gas production. "Natural gas has nothing to trade on," said Stephen Schork, president of the trading advisory The Schork Group. "We're just waiting for every last bull to get out of the market before we can get a rebound." On Tuesday, natural gas futures plunged to their lowest level since early 2002. Front-month futures are down more than 50% from this time last year. Little in the weather outlook has changed in the last day. Private forecaster WSI called for "above and much above normal temperatures over most of the country next week." Temperatures should fall somewhat the following week but are expected to remain above average. Many market participants say they expect even further declines ahead. Despite weak demand and falling prices, gas producers have shown little willingness to curb production. The so-called shale gas boom has unlocked vast new supplies of gas across the country over the last several years. For many producers, pumping that gas is so cheap that there's little incentive to stop production. Other wells pump a mixture of gas and so-called natural gas liquids that fetch a price closer to crude oil, justifying continued production. "If we cannot get colder temperatures over an extended period, or if we cannot build enough export capacity or if industrial baseload use cannot be rebuilt quickly enough, this is going to feel like a race to zero," said Peter Beutel, head of the trading advisory firm Cameron Hanover, in a research report.

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