A near-record amount of natural gas was produced for the month, which kept prices under pressure. Yesterday, natural gas prices decreased by -3.63% to 172.8 in anticipation that milder weather would lower the need for heating. The United States Energy Information Administration (EIA) predicted that due to milder weather, the country’s power consumption will decrease by around 1% in 2023 compared to the previous year.
This will be the first decline since 2022 when usage reached a record high. Refinitiv reported that as of the first week of April, the average gas output in the Lower 48 States of the United States has increased to 100.1 billion cubic feet per day (bcfd), up from 98.7 bcfd in March. In research released by the EIA, it is predicted that U.S. natural gas production will reach a record high in 2023. According to the April Short-Term Energy Outlook published by the EIA, the nation’s dry gas output would rise from a record 98.11 billion cubic feet per day (bcfd) in 2022 to 100.87 bcfd in 2023 and 101.58 bcfd in 2024.
The survey also predicted that, with stocks expected to remain above the five-year average in 2023, natural gas prices will typically be less than $3 per million British thermal units (MMBtu) for that year, a more than 50% decrease from the previous one. According to the research, the Henry Hub natural gas spot price fell to an average of $2.31 per MMBtu in March 2023 from a November 2022 high of $5.45 per MMBtu.
Technically, the market is experiencing new selling as open interest increased by 12.45% to close at 46794 while prices are down 6.5 rupees. Natural gas is now receiving support at 167.6 and a move below that level could result in a test of 162.4 levels, while a move above that level could result in prices testing 189.2.
