NEW YORK (Dow Jones)--Natural gas futures ended nearly 8% lower Thursday after government data showed that U.S. gas inventories have reached an all-time record high.

Natural gas for November delivery on the New York Mercantile Exchange settled 37.5 cents lower, or 7.75%, at $4.466 a million British thermal units after reaching a low of $4.439/MMBtu in combined electronic and floor trade.

The glut of natural gas in storage weighed on prices Thursday. Futures extended losses after the Energy Department reported that 64 billion cubic feet of gas were added to U.S. storage for the week ended Sept. 25, bringing total supplies to a record 3.589 trillion cubic feet.

Gas inventories are now 15.5% above the five-year average and 15.8% above the year-ago level. Analysts and traders had predicted a 60-bcf build.

Gas prices are likely to near $4/MMBtu as oversupply pressures the market lower, said Allen Rather, an independent energy analyst in Victoria, Texas. Ample supplies from onshore shale-gas fields, despite production curtailments, have met with weak demand during the economic downturn.

"We still have another month left [before the winter heating season], and we're already at record levels," Rather said.

Analysts and traders predict that U.S. gas storage facilities will near full capacity, an estimated 3.9 trillion cubic feet, before the beginning of the winter heating season Oct. 31.

Low physical gas prices were also pressuring gas futures lower. Natural gas for next-day delivery at the benchmark Henry Hub in Louisiana was recently trading at $2.91/MMBtu, nearly a dollar below the futures price. Physical gas prices have slipped as storage facilities near full capacity.

"The futures arguably need to make a downside price adjustment over the near term in order to close this gap, almost regardless of the exact dimensions of the storage injection for the last week," wrote Tim Evans, an analyst with Citi Futures Perspective in New York, in a note to clients Thursday.

-By Christine Buurma, Dow Jones Newswires; 212-416-2143;