Adds closing prices

Sept 12 (Reuters) -U.S. natural gas futures rose nearly 5% on Thursday on a smaller-than-expected storage build last week, while traders assessed the impact on supply after oil and gas producers cut output due to Hurricane Francine.

Front-month gas futures NGc1 for October delivery on the New York Mercantile Exchange rose by 8.7 cents, or about 3.8%, to settle at $2.357 per million British thermal units (mmBtu). The contract gained almost 5% earlier in the session.

The U.S. Energy Information Administration (EIA) said utilities added 40 billion cubic feet (bcf) of gas into storage during the week ended Sept. 6.

That was lower than the 48-bcf build analysts forecast in a Reuters poll and compares with an injection of 50 bcf during the same week a year ago and a five-year average (2019-2023) increase of 67 bcf for this time of year. EIA/GASNGAS/POLL

Even though storage builds have been smaller than average in recent weeks, the amount of gas in storage is still around 10% higher than usual for this time of year.

"This market is holding steady thus far as it attempts to predict the impact of Hurricane Francine on lost natural gas production where estimates vary widely to as high as 50%," energy advisory firm Ritterbusch and Associates said in a note.

"However, the lost supply will likely prove modest within the overall US gas balances within this age of shale. It also appears that the storm has evaded key LNG export infrastructure in providing a supportive influence to the market," Ritterbusch said.

Francine, which has been downgraded to a tropical depression, barreled into southeast Louisiana and southern Mississippi and Alabama on Thursday, pounding the region with heavy rains and gusty winds while threatening the Gulf Coast with dangerous flooding and widespread power outages.

The amount of natural gas flowing to U.S. liquefied natural gas export plants was on track to slide further on Thursday with energy companies reducing feedgas to plants because of the storm, according to data from financial firm LSEG.

More than 75% of U.S. gas production comes from big inland shale basins like Appalachia in Pennsylvania, West Virginia and Ohio and the Permian in West Texas and eastern New Mexico. Analysts said hurricanes were more likely to reduce gas prices by cutting demand through power outages and knocking LNG export plants out of service.

SUPPLY AND DEMAND

Financial firm LSEG said gas output in the Lower 48 U.S. states has slid to an average of 102.1 billion cubic feet per day (bcfd) so far in September, down from 103.2 bcfd in August.

LSEG forecast average gas demand in the Lower 48, including exports, will rise from 99.6 bcfd this week to 100.1 bcfd next week.

Meanwhile, LSEG forecast average gas supply in the Lower 48, including exports, will fall marginally from 109.8 bcfd this week to 109.4 bcfd next week.

Reporting by Sherin Elizabeth Varghese and Brijesh Patel in Bengaluru, Editing by Nick Zieminski, Paul Simao and Diane Craft

For gas data on the LSEG terminal type ENERGY in the search bar and then go to the GAS drop down and the NORTH AMERICA drop down.

For Interactive Map, type 'Interactive Map' in the box at upper left of the LSEG terminal

For graphics on Baker Hughes rig counts, see: http://graphics.thomsonreuters.com/15/rigcount/index.html

For next-day SNL U.S. gas prices, see: 0#SNL-NG

For next-day SNL U.S. power prices, see: 0#SNL-PWR

For U.S. natgas price and storage polls, see: NGAS/POLL

For U.S. nuclear power outages, see: NUKE/

For U.S. Northwest hydro power report, see: NWRFC

For U.S./Canada natural gas rig count vs Henry Hub futures price, see: http://tmsnrt.rs/2eT9k44

For the U.S. natural gas speed guide, see: USGAS

For the U.S. power speed guide, see: USPOWER

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NYMEX Henry Hub options and futures combined 0#3CFTC023651

NYMEX Henry Hub futures only 0#1CFTC023651

ICE Henry Hub options and futures combined 0#3CFTC023391

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NYMEX Henry Hub Penultimate gas swaps 0#3CFTC03565C