Natural gas futures experienced significant declines, concluding at Rs 381.1, reflecting a 9.39% drop due to ongoing pressures from near-record production levels in the U.S., ample storage capacities, and lackluster global pricing trends. In December, production across the Lower 48 states has averaged 109.6 billion cubic feet per day, aligning with the record high established in November.

While daily output has moderated to approximately 108.4 bcfd following a peak of 111.3 bcfd on November 28, the overall supply landscape continues to exhibit remarkable strength. Strong production has allowed operators to keep storage levels healthy, with inventories presently 5% above the seasonal average.

The U.S. Energy Information Administration has reiterated its forecasts for unprecedented production and demand in 2025, with projections indicating that dry gas output will increase to 107.7 bcfd next year and reach 109.1 bcfd in 2026. Consumption is projected to rise to 91.8 bcfd in 2025 before experiencing a moderation in 2026. These estimates align closely with previous forecasts, highlighting a market that is structurally well-supplied. For the week ending December 5, storage withdrawals totaled 177 bcf, indicating the fourth consecutive week of the withdrawal season. Total stocks currently amount to 3,746 bcf—0.7% lower than the previous year yet 2.8% higher than the five-year average, thereby reinforcing the narrative of oversupply.

From a technical standpoint, the market is experiencing renewed selling pressure, as evidenced by a significant 31.66% increase in open interest to 22,188 contracts, coinciding with a price decline of Rs 39.5. Immediate support stands at Rs 368.3, and a breach could potentially pave the way toward Rs 355.5. Resistance currently stands at Rs 405.6, and a breach above this threshold could initiate additional upward movement toward Rs 430.1.