Cold boosts NY natgas to 6-mth high, futures weigh

NEW YORK, Jan 9 (Reuters) - Extreme cold weather forecast for the U.S. Northeast next week pushed up regional natural gas prices on Friday to their highest levels since the summer.

But high storage, weaker energy futures and recent pipeline improvements into the New York City area helped limit gains, traders said.

Gas on the Transco pipeline at the New York city gate NG-NYCZ6 traded as high as $14 per million British thermal units for gas delivered through Monday, its highest level since July, according to Reuters data.

But the prices paled in comparison to deals done in January 2008 above $38 per mmBtu.

Forecasters called for high temperatures to peak in the teens degrees Fahrenheit in New York at times next week, with lows in the low teens F.

But traders said utilities could be turning to high winter inventories, instead of the more expensive spot market, to meet increased heating demand.

U.S. natural gas underground storage last week climbed above year-ago levels for the first time in more than a year, as demand destruction from the slowing economy and light holiday industrial loads led to a smaller-than-expected weekly withdrawal. [ID:nN08543804]

In addition, energy futures have slumped amid the slowing economy.

Gas futures on the New York Mercantile Exchange NGG9 were trading in the $5.45 per mmBtu area Friday, down more than $8, or 60 percent, from early July highs above $13 per mmBtu.