Natural Gas Dropped as Output Continues to Rise
Natural Gas yesterday settled down by -4.8% at 360.7 as output continues to rise and with utilities expected to keep stockpiling gas into mid-November. That price decline came despite forecasts for cooler, near-normal weather over the next two weeks that will boost heating demand higher than previously expected through late November. In October, global gas prices hit record highs as utilities around the world scrambled for liquefied natural gas (LNG) cargoes to replenish low stockpiles in Europe and meet insatiable demand in Asia, where energy shortfalls have caused power blackouts in China.
Data provider Refinitiv said output in the U.S. Lower 48 states averaged 96.1 billion cubic feet per day (bcfd) so far in November, up from 94.1 bcfd in October and a monthly record of 95.4 bcfd in November 2019. Refinitiv projected average U.S. gas demand, including exports, would jump from 97.0 bcfd this week to 104.4 bcfd next week and 109.4 bcfd in two weeks as the weather turns seasonally colder and homes and businesses crank up their heaters. With gas prices near $25 per mmBtu in Europe and $31 in Asia, compared with about $5 in the United States, traders said buyers around the world will keep purchasing all the LNG the United States can produce.
Technically market is under fresh selling as the market has witnessed a gain in open interest by 4.45% to settled at 7111 while prices down -18.2 rupees, now Natural gas is getting support at 350.3 and below same could see a test of 340 levels, and resistance is now likely to be seen at 376.9, a move above could see prices testing 393.2.