NEW YORK (Dow Jones)--Natural gas futures extended gains Friday as traders surmised that the approach of winter weather would begin to put a dent in near-record supplies.

Natural gas for October delivery on the New York Mercantile Exchange was trading 8.4 cents higher, or 2.58%, at $3.34 a million British thermal units after opening floor trade 1.3 cents lower at $3.243/MMBtu.

Traders believe natural-gas prices may have finally reached a floor after tumbling more than 80% over the past several months on ample supplies, mild weather and weak energy demand during the economic downturn. As the winter heating season approaches, it could prove difficult for gas prices to slip below $3 a million British thermal units again, said John Kilduff, an analyst with MF Global in New York.

Withdrawals from gas storage begin in the winter as the fuel is used to heat homes and businesses.

"We're definitely in the clubhouse turn in terms of how much more we'll see in terms of storage injections," Kilduff said. "If we don't reach incredible numbers of 3.7 trillion cubic feet or more, you could construct a scenario where a colder-than-normal winter begins to challenge the storage picture."

But gas inventories remain abundant, and the price rally could fizzle as storage facilities near full capacity - an estimated 4 trillion cubic feet. Total gas in U.S. storage as of Sept. 4 was 3.392 tcf, about 17% above both the five-year average and last year's level.

"There are still approximately eight weeks until the traditional end-of-October injection season, and a test of capacity lies ahead," wrote James Crandell, an analyst with Barclays Capital in New York, in a note to clients Friday. "Thus, we think the recent spurt of price strength may be short-lived."


-By Christine Buurma, Dow Jones Newswires; 212-416-2143; christine.buurma@dowjones.com