Alcoa Inc. (AA), the world's largest aluminum producer, on Thursday warned that its third-quarter earnings would be as much as 39 percent below Wall Street estimates on lower aluminum prices and higher energy and raw-material costs.

Alcoa also cited weakness in automotive markets and in Europe in its new forecast for earnings per share from continuing operations of 27 cents to 31 cents. Analysts polled by Reuters Estimates had expected earnings per share of 44 cents on average.

The shares of the Dow component were down more than 5 percent in after-hours trade on the news of the shortfall, which were seen as a consequence of the surge in energy prices in particular.

"All these companies are getting hit by (natural) gas. The problem is we know what they are getting hit by but it's impossible to put a number on because you don't know what their hedges are," said analyst Charles Bradford of Bradford Research/Soleil Securities.

Natural gas futures have climbed about 86 percent during the third quarter, driven in part by production cuts due to Hurricane Katrina and the soon-to-strike Hurricane Rita.

"I know the numbers are going to be bad for all of these guys," Bradford said, referring to competitors in the aluminum business like Alcan Inc. (AL) as well as steel companies, all of whom carry significant energy costs. Earlier this week United States Steel Corp (X) warned of a shortfall due in part to energy costs.

Alcoa also said aluminum prices on the London Metal Exchange fell during the quarter, and said recent strength in metal prices will not be reflected until the fourth quarter.

A number of analysts have taken a dimmer view on the aluminum sector in recent days due to the tandem pressures of falling prices and higher energy costs.

Last week UBS lowered its third-quarter earnings estimate on Alcoa to 37 cents per share, and earlier this month Citigroup cut the stock to "neutral weight" from "overweight," seeing limited industry upside.

With Hurricane Rita bearing down on the U.S. Gulf Coast, Alcoa also said it did not yet know what the impact would be from the closure of an alumina refinery in Texas and an anode plant in Louisiana ahead of the storm. Any impact, Alcoa said, would be reflected in third-quarter results.

Shares in Alcoa fell 5.4 percent to $24.50 in after-hours trade on Inet following a close of $25.90 on the New York Stock Exchange. During the quarter, the stock is down about 0.9 percent, compared with a gain of 1.4 percent for the Dow Jones Industrial Average (search).

Alcoa's closest competitor, Alcan, was down 2.2 percent in after-hours trade on Inet.