Natural gas edges up higher heating demand over the next week

Nat. Gas yesterday settled up by 0.16% at 185.2 despite a bigger-than-expected storage build as forecasts for colder weather and higher heating demand over the next week than previously expected offered support. US utilities added 75 billion cubic feet (bcf) of gas into storage during the week ended April 14, more than market expectations of a 69 bcf increase, as mild weather kept heating demand low. That compares with an increase of 47 bcf in the same week last year and a five-year (2018-2022) average increase of 41 bcf. 

Last week’s increase boosted stockpiles to 1.930 trillion cubic feet (tcf), 488 bcf higher than last year at this time and 329 bcf above the five-year average of 1,601 bcf. At 1,930 bcf, the total working gas is within the five-year historical range. Refinitiv said average gas output in the U.S. Lower 48 states rose to 100.2 bcfd so far in April, up from 99.7 bcfd in March. Daily however output was on track to drop about 2.3 bcfd over the past few days to a preliminary 10-week low of 98.4 bcfd on Thursday, due mostly to declines in Pennsylvania and West Virginia. 

Technically market is under short covering as the market has witnessed a drop in open interest by -25.49% to settle at 20082 while prices are up 0.3 rupees, now is getting support at 179 and below the same could see a test of 172.9 levels, and resistance is now likely to be seen at 188.9, a move above could see prices testing 192.7.