Natural gas prices experienced a decline of 2.88%, settling at Rs 296.7. This movement was influenced by a larger-than-anticipated storage build, which underscored the prevailing conditions of ample supply. U.S. energy firms injected 87 billion cubic feet of gas into storage during the week ended October 17, surpassing the anticipated 83 bcf build and the five-year average. This rise elevated inventories to 0.9% higher than the previous year’s figures and 4.5% above the five-year average, indicating a favorable supply situation as the winter season approaches.

The negative influence of increased storage levels eclipsed positive elements like enhanced short-term demand projections, reduced domestic output, and strong LNG export activity. Data indicated that U.S. output in the Lower 48 states has averaged 106.6 billion cubic feet per day in October, a decrease from 107.4 billion cubic feet per day in September and a peak of 108 billion cubic feet per day in August.

In light of the recent decline, projections from the U.S. Energy Information Administration indicate that dry gas production is expected to reach unprecedented levels of 107.1 bcfd in 2025 and 107.4 bcfd in 2026, coinciding with record consumption figures. LNG exports are projected to increase significantly to 14.7 bcfd in 2025 and 16.3 bcfd in 2026, indicative of robust global demand.

From a technical perspective, the market is experiencing long liquidation, evidenced by a 14.54% decrease in open interest to 12,448 contracts, alongside an Rs 8.8 decline in prices. Immediate support stands at Rs 291.3, with additional downside potential toward Rs 285.9, while resistance is observed at Rs 305.1 and Rs 313.5 on the upside.