Natural gas rose Wednesday by 3.38% to settle at 192.6, helped by increased demand and decreased supply. The demand for gas to generate electricity for air conditioning is projected to increase due to a predicted heatwave from 21 to 28 June. The domestic output is also decreasing from May’s record high of 102.5 bcfd. On the other side, due to maintenance at a number of facilities, notably Cheniere Energy Inc.’s LNG, gas flowing to U.S. LNG export plants decreased to a five-month low.
The average petrol output in the Lower 48 States of the United States has decreased to 102.3 billion cubic feet per day (bcfd) so far in June, according to data source Refinitiv, from a monthly high of 102.5 bcfd in May. On schedule to increase to 7.5 bcfd on Monday from an almost two-week low of 7.2 bcfd on Saturday when wildfires once more forced energy companies to shut in wells and pipelines.
Through June 20, the weather in the Lower 48 states was expected to be mainly in line with expectations before becoming hotter than usual from June 21 to June 27. Refinitiv predicted the demand for U.S. petrol, including exports, would increase from 93.1 bcfd this week to 97.9 bcfd next week as a result of the impending warming of the climate.
Technically, the market is under short covering as open interest decreased by -19.91% to settle at 34119 while prices increased by 6.3 rupees. Currently, natural gas is receiving support at 188.4 and a move below that level could result in a test of the 184.3 levels. Meanwhile, resistance is now expected to be seen at 195.9, and a move above that level could result in prices testing 199.3.
