Advertisements

Natural Gas Futures Decline Ahead of EIA Report Release

by Krystal

As anticipation mounts for the impending government storage report, U.S. natural gas futures are experiencing a downturn, with traders eyeing the crucial 50-day moving average at $1.961, a notable trend indicator since late January. This trend has prompted preparations for potential market volatility.

At 13:23 GMT, Natural Gas is trading at $1.831, marking a decrease of $0.054 or -2.86%.

Advertisements

EIA Report Projections

Attention is squarely focused on today’s eagerly awaited EIA weekly storage report, poised to unveil whether market equilibrium has shifted. Current projections hint at a build ranging from +8 to +15 Bcf, slightly below the 5-year average of +24 Bcf. This modest build is attributed to cooler-than-normal temperatures in regions such as the Midwest, Northeast, and California, offset by warmer conditions elsewhere. The consensus expectation sits at a build of +13 Bcf.

Advertisements

Insights from The Wall Street Journal

Analysts surveyed by The Wall Street Journal anticipate a modest uptick in U.S. natural gas inventories, estimating a rise of 11 Bcf to 2,270 Bcf. This figure falls short of the five-year average injection for the same week, signaling a marginal reduction in surplus storage that concluded the heating season 39% above average.

Advertisements

Global Geopolitical Factors

Global events are also influencing the natural gas market, notably the recent assaults on Ukrainian gas storage facilities by Russia. These actions have propelled gas prices in Europe upward, highlighting the vulnerability of energy infrastructure in conflict zones.

Advertisements

Weather and Demand Outlook

The NatGasWeather forecast for April 11-17 outlines a series of weather systems traversing the U.S., accompanied by mild to warm temperatures. This weather pattern suggests a diminished demand for natural gas in the immediate future.

Short-Term Market Forecast

Given the projected below-average inventory build, compounded by geopolitical tensions and forecasts of mild weather, the short-term outlook for the natural gas market tilts bearish. The forthcoming EIA report is poised to catalyze market fluctuations, particularly concerning inventory levels and European market responses to geopolitical uncertainties.

Technical Analysis

Natural gas futures are sliding lower on Thursday after briefly turning upwards earlier in the week. A breach of $1.746 would reverse the short-term trend downwards.

Today’s pivotal level to monitor is the 50-day moving average at $1.961. With the intermediate trend on a downward trajectory, attention is drawn towards potential selling pressure upon the initial test of this trend indicator. However, surpassing it could signify a shift in sentiment and potentially fuel an upsurge.

Advertisements
Advertisements

You may also like

oftrb logo

Oftrb.com is a comprehensive energy portal, the main columns include crude oil prices, energy categories, EIA, OPEC, crude oil news, basic knowledge of crude oil, etc.

【Contact us: [email protected]

© 2023 Copyright oftrb.com – Crude Oil Market Quotes, Price Chart live & News [[email protected]]