As investors continue to track the amount of gas flowing to US LNG export plants and weather predictions, natural gas prices yesterday decreased by -4.94% to 207.7. As households and businesses turn up their air conditioners to escape the first heat wave of the summer of 2023, power use in Texas is anticipated to set records the following week.
According to data source Refinitiv, average gas production in the Lower 48 States of the United States has decreased to 101.9 billion cubic feet per day (bcfd) so far in June from a monthly high of 102.5 bcfd in May. From June 16 to 22, the weather was expected to stay generally within normal limits before becoming hotter than usual from June 23 to July 1. Refinitiv predicted that due to the impending warmer weather, the U.S. petrol demand, which includes exports, would increase from 93.2 bcfd this week to 96.0 bcfd next week and 101.8 bcfd in two weeks.
In contrast to market predictions of a 95 bcf rise, US utilities added 84 billion cubic feet of gas to storage, according to the EIA. A projected heatwave from June 23 to 30 is also anticipated to increase gas demand, notably for electricity generation used in air conditioning. In terms of supply, domestic gas production is down from the record 102.5 bcfd seen in May.
Technically, the market is in long liquidation because open interest fell by -4.86% to settle at 16349 while prices fell by 10.8 rupees. Currently, natural gas is receiving support at 202.3, and a move below that level could result in a test of the 196.8 level. Resistance is now anticipated to be seen at 217.4, and a move above that level could result in a test of 227.
