Natural gas prices experienced a significant increase, rising by 4.31% to close at Rs 295.5, influenced by heightened geopolitical tensions in the Middle East that have sparked renewed worries about potential supply disruptions. Iran’s missile strikes on Qatar’s Ras Laffan Industrial City—home to the world’s largest LNG export facility—along with reported hits on energy infrastructure in Abu Dhabi and Bahrain, have significantly heightened market anxiety surrounding global gas flows. On the supply side, trends in US production exhibited a mixed performance.

In March, average output in the Lower 48 states increased slightly to 109.8 bcfd; however, daily production has decreased by approximately 4 bcfd in recent days, reaching a six-week low as a result of declines in significant areas such as North Dakota, Louisiana, and Pennsylvania. Storage data provided valuable insight, revealing a withdrawal of 38 bcf that was smaller than anticipated, suggesting that the winter drawdown season could be approaching its conclusion.

Inventories remain 8.3% above the previous year, albeit marginally under the five-year average. In the coming years, the EIA maintains its forecast for unprecedented production levels extending through 2027, despite a slight easing in domestic demand, while LNG exports are anticipated to rise consistently.

From a technical perspective, the market is experiencing short covering, as evidenced by a significant decline in open interest in conjunction with increasing prices. Immediate support is established at Rs 287.2, with additional downside potential toward Rs 278.8 if this level is breached. On the upside, resistance is positioned at Rs 304.8, and a breakout above this threshold could propel prices toward Rs 314.