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Natural Gas Rises as Heat Continues for Most States, Boosting Cooling Demand

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Natural gas rose early on Wednesday as heat for most states is expected to continue for two weeks, boosting cooling demand.

Gas for August delivery was last seen up $0.04, or 1.4%, to $3.31 per million British thermal units, the highest since June 25.

Cooling demand remains high, with long-term forecasts from the National Weather Service expecting most states to see higher than seasonal temperatures over its eight to 14 day outlook, raising air-conditioning use.

Demand for the fuel is expected to remain strong over the long term, with the Energy Information Administration on Tuesday saying it expects demand to rise to a record next year on rising power-sector use.

"We expect U.S. natural gas consumption in the electric power sector will set a record next year, driven largely by rising overall electricity demand, the expansion of the natural gas generating fleet, and relatively low natural gas prices," the agency said in its monthly Short-Term Energy Outlook. "Forecast natural gas demand across the economy rises slightly this year before increasing 3% in 2027."

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