Natural gas futures edged lower Friday, as traders weighed the impact of Hurricane Irene and its potential to knock out electricity-driven demand.

Natural gas for September delivery recently traded down 1.5 cents, or 0.4%, to $3.916 a million British thermal units on the New York Mercantile Exchange.

Major cities along the East Coast braced for the impact of the storm, which is expected to make landfall in North Carolina sometime Saturday, according to forecasts. Surging storm waves along the state's Outer Banks were already reported Friday.

The storm threatens to cause billions in damage to cities from Washington to New York to Boston. Natural gas traders are bracing for possible power outages, which could lead to a reduction in gas-driven electricity use.

"If (electricity) was cut, there wouldn't be natural gas used as the input for power generation," said Matt Smith, analyst at Summit Energy in Louisville, Ky. "There's a number of unknowns about it."

Friday's decline, however, was moderated by a weather outlook that continues to call for unseasonably warm weather over much of the country over the next six to 10 days. The warm weather should contribute to demand for gas-driven electricity to power air conditioners.

The Commodity Weather Group called for temperatures as high as the 90s in Chicago and warm weather across the Midwest. The heat should reach the East Coast by the end of next week, the forecaster said.

"The hottest anomalies may wait until the start of the Labor Day holiday weekend," CWG said in a report.

Friday's move lower was also tempered by a report on Thursday from the Department of Energy showing U.S. gas inventories rising in line with expectations. The DOE said 73 billion cubic feet of gas was added to U.S. stockpiles during the week ended Aug. 19.

Gas futures have been drifting lower in recent weeks as the summer cooling-demand season comes to a close, after unusually high temperatures sent futures surging to near $5 per million British thermal units in June. A surplus of gas and high production levels continue to keep traders from pushing prices aggressively higher.

"Most participants are viewing the natural gas as too low priced to approach from the sell side while fundamentals remain sufficiently bearish to preclude an aggressive incursion into the buy side," Jim Ritterbusch, head of Ritterbusch and Associates, said in a research report.