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Natural Gas

Natural gas prices slipped near to one month low

Henry hub Natural gas future prices plunged in previous week after two weeks of straight gains .Moderate temperature across US led to lower demand and rising production continued to dampen market sentiments

Henry hub natural gas futures prices for April delivery dropped by 4.28 percent in previous by almost paring its early losses on weekend and finally settled at $2.535 per mmBtu last week. While here in domestic futures platform MCX Natural Gas futures prices shed more than 2.00 percent and finally settled at Rs 189.10 per mmBtu.

U.S. Natural gas prices likely to extend its weakness

* U.S production continues to increase ,while average net imports from Canada increased by 4.1% week over week.

* In US on weekly basis, Natural gas consumed for power generation and industrial sector decreased by 4.0 % and 0.6% respectively. While residential and commercial sectors too consumption declined by 1.2% on mild weather pattern.

* Natural gas exports from US declined week over week , exports to Mexico decreased by 8.8% as a result of scheduled seasonal maintenance on pipelines in Mexico.

Money managed Natural Gas positions in NYMEX

U.S. Commodity Futures Trading Commission (CFTC) data showed that the money mangers reduced the Natural Gas F&O positions in NYMEX and increased shorts. The net long position decreased.

U.S. Natural Gas storage slipped

The US government said the country’s natural gas storage industry posted addition in its latest report. Energy Information Administration (EIA) summarized that the net injections into storage totalled 20 Bcf for the week ending April 2 compared with the five year (2016-2021) average net injections of 8 Bcf and last year’s net injections of 30 Bcf during the same week. Working natural gas stocks totalled 1,784 Bcf, which is 24 Bcf lower than the five-year average and 235 Bcf lower than last year at this time.

NYMEX: As long as the support of $2.2 undisturbed, expects recovery rallies in the counter. A direct drop below 2.10 is a signal of near term liquidation pressure . 

In MCX, if prices hold the support of Rs 175 expect recovery upticks to continue in the counter. However, a direct drop below the same is a signal of reversal.

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