Natural Gas prices rise on cooler forecasts

Natural gas prices climbed 0.68% to ₹267.3, driven by expectations of cooler temperatures in mid-February, which could increase heating demand. This rise comes despite near-term forecasts indicating milder conditions and reduced demand for the upcoming week. Investors are also reacting to a significant anticipated storage withdrawal following last week’s extreme cold in the U.S.

The impact of this cold spell was evident, pushing daily gas consumption to an all-time high of 181.2 billion cubic feet per day (bcfd) on January 21, surpassing the previous record of 168.4 bcfd set in January 2024. Consequently, the U.S. Energy Information Administration (EIA) reported a 321 billion cubic feet (bcf) withdrawal from storage, exceeding market expectations of 313 bcf. This reduction brought inventories down to 2,571 bcf, positioning storage levels 5.3% below last year and 4.1% under the five-year average.

Meanwhile, data from Baker Hughes (NASDAQ:BKR) revealed a slight drop in the U.S. natural gas rig count, which fell by one to 98. Market watchers are also tracking forecasts from LSEG, which predict total gas demand in the Lower 48 states will decline from 136.4 bcfd this week to 123.8 bcfd next week, before rebounding to 132.8 bcfd in the following week.

Looking ahead, the EIA projects U.S. dry gas production to rise to 104.5 bcfd in 2025 and 107.2 bcfd in 2026, while domestic consumption is expected to see a modest increase to 90.6 bcfd in 2025 before slightly declining to 90.4 bcfd in 2026.

From a technical standpoint, fresh buying interest is emerging, with open interest increasing by 0.14% to 18,297 contracts. Current support is at ₹264.4, with a potential decline to ₹261.6 if downward pressure intensifies. On the upside, resistance at ₹269.7 suggests a breakout could propel prices towards ₹272.2.

Natural gas remains a key player in the global energy market, with supply-demand dynamics and weather patterns driving price fluctuations. As investors monitor evolving conditions, strategic positioning in the market remains crucial.

Valeura Energy Inc (TSX:VLE) is an upstream oil & gas company, with a clear strategy to add value for shareholders. The Company has a strong balance sheet positioning it for potential inorganic growth opportunities in the near/medium-term, and substantial longer-term upside potential through an operated deep, tight gas play. 

Click to view all articles for the EPIC:
Or click to view the full company profile:
Facebook
X
LinkedIn
Valeura Energy

More articles like this

Valeura Energy

Natural Gas rebounds amid rising demand

February Nymex natural gas prices rebounded as traders covered shorts amidst surging European gas prices. Warm US weather and EIA draw forecasts also in focus.

Valeura Energy

Valeura Energy completes Jasmine Field drilling, boosting output

Valeura Energy Inc (TSX:VLE, OTCQX:VLERF) has announced the successful completion of an infill drilling campaign at the Jasmine field in Licence B5/27 (100% operated working interest), offshore Gulf of Thailand. Dr. Sean Guest, Valeura Energy President and

Valeura Energy

Valeura Energy completes restructuring of Thai operations

Valeura Energy Inc., a Canadian company focused on petroleum and natural gas exploration and production, recently finalised a reorganisation of its subsidiaries in Thailand. This internal restructuring now consolidates Valeura’s interests in the Nong Yao, Manora,

Valeura Energy

Valeura Energy driving growth and innovation in Thailand

Valeura Energy, a Canadian oil and gas firm, has carved a significant presence in the Gulf of Thailand, strategically positioning itself as one of the leading producers in the region. Since acquiring assets from KrisEnergy and

Valeura Energy

Opportunities for energy development in Thailand

Thailand presents a unique opportunity for energy exploration and production. The country benefits from proven petroleum systems and relatively favourable offshore operating conditions in shallow waters. Mid-life oil fields offer potential to extend their lifespan through