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By Bloomberg

Natural gas declined a third day in New York as forecasts for a mild start to December signaled reduced demand for the heating fuel.

Temperatures will be above normal across most of the lower 48 states from Nov. 30 through Dec. 9, according to MDA Weather Services in Gaithersburg, Maryland. The warmth follows a blast of arctic air that may have contributed to a near-record weekly withdrawal of gas from storage last week, based on analyst estimates compiled by Bloomberg. December futures expire today.

“The change in the weather forecast for the first part of December is taking a lot of air out of the balloon this week,” said Gene McGillian, senior analyst at Tradition Energy in Stamford, Connecticut. “Without forecasts for real cold or high levels of heating demand, the market will be pinned near $4.”

Natural gas for December delivery slid 3.1 cents, or 0.8 percent, to $4.12 per million British thermal units at 9:46 a.m. on the New York Mercantile Exchange. Volume for all futures was 30 percent below the 100-day average. Prices have dropped 2.6 percent this year.

The more actively traded January contracts fell 5.1 cents, or 1.2 percent, to $4.253.

Forecasts for eastern states turned warmer for next week, followed by a less intense cold front moving into the Midwest from Canada Dec. 5 through Dec. 9, said MDA in Gaithersburg, Maryland. About 49 percent of U.S. households use gas for heating, led by the Midwest.

Chicago High

The high temperature in Chicago on Dec. 3 may reach 48 degrees Fahrenheit (9 Celsius), 8 above normal, AccuWeather Inc. said on its website. Washington’s reading will climb to 15 above average at 66.

Gas inventories in the contiguous states probably fell by 146 billion cubic feet last week, based on the median of eight analyst estimates compiled by Bloomberg. The U.S. Energy Information Administration is scheduled to release its weekly supply report tomorrow, a day earlier than usual because the U.S. Thanksgiving Day holiday the following day.

Estimates ranged from declines of 131 billion to 157 billion cubic feet. The record withdrawal for the period is 148 billion in the week ended Nov. 24, 2000, according to Energy Information Administration data. The five-year average drop for last week is 6 billion.

The pace of storage withdrawals will slow to 33 billion in next week’s EIA report, with a slight increase to 35 billion the following week, Tim Evans, an energy analyst at Citi Futures in New York, said in a report to clients yesterday.