Natural gas yesterday settled lower by 2.57% at Rs 269.4, as mild weather forecasts and ample storage levels alleviated concerns regarding supply tightness. Revised weather models suggest that above-average temperatures will continue into late October, postponing any notable increase in heating demand. Reports indicates that significant cooling is improbable until the last week of the month.

In the meantime, production in the Lower 48 states has averaged 106.4 billion cubic feet per day thus far in October, which is a slight decline from September’s 107.4 bcfd and August’s peak of 108 bcfd. The prior increase in production has led to robust storage injections, resulting in inventories currently standing 4% above the five-year average. U.S. utilities injected 80 billion cubic feet of gas into storage for the week ending October 3, bringing total stocks to 3,641 billion cubic feet—23 billion cubic feet above last year’s level and 157 billion cubic feet higher than the five-year average.

Liquefied natural gas exports persist in providing support, with feedgas deliveries averaging 16.3 bcfd this month and reaching a peak of 17 bcfd after the resumption of operations at Berkshire Hathaway’s Cove Point terminal. The U.S. Energy Information Administration anticipates unprecedented levels of gas production and consumption in 2025, followed by a moderation in 2026, in conjunction with increasing LNG exports.

From a technical perspective, the market is experiencing renewed selling pressure, evidenced by an 8.98% increase in open interest to 40,907 lots, alongside a price decline of Rs 7.1. Natural gas establishes a support level at Rs 265.7, with potential for further decline to Rs 261.9. Resistance is identified at Rs 275.1; a breach above this level may propel prices toward Rs 280.7.