Naturalgas On MCX Settled Up

Naturalgas on MCX settled up 0.55% at 184.4 after Thursday’s data showed that natural gas supplies in storage in the U.S. fell more than expected last week. The Energy Information Administration (EIA) reported that natural gas in underground storage fell by 89 billion cubic feet ((bcf)) in the week ending February 17th. This left storage levels 10% lower than a year ago but 7.1% higher than the five-year average. 

That compared with a withdrawal of 114 billion cubic feet in the preceding week, 117 billion a year earlier and a five-year average drop of 158 billion cubic feet. Total natural gas in storage currently stands at 2.356 trillion cubic feet, according to the U.S. Energy Information Administration, 2.5% lower than levels at this time a year ago and 6.6% above the five-year average for this time of year. 

Looking ahead, market expectations for storage changes for the week ending February 24th are a build of 1 bcf. That compares unfavorably to a draw of 67 bcf last year and a five-year average draw of 132. In the four weeks ending March 17th, the data show a drop of 97 bcf. This average is 29 bcf slower than the same weeks last year, and about 277 bcf slower than the five-year average. Prices of the heating fuel are down a whopping 28% so far this year as forecasts for warm winter weather weighed on heating demand expectations.

Futures touched the lowest level in around six months earlier this week as forecasts called for mostly warmer-than-normal weather in key regions across the U.S. for the rest of the winter. Technically now Naturalgas is getting support at 182.5 and below same could see a test of 180.5 level, And resistance is now likely to be seen at 187, a move above could see prices testing 189.5.

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Suhani Verma

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