Natural gas prices increased by 0.53% to close at Rs 244.6, bolstered by a recent decline in daily production and marginally improved near-term demand forecasts. Despite overall production in the U.S. staying close to record highs, a recent short-term decline of approximately 4.6 bcfd, primarily from Texas and Louisiana, has provided some upward pressure on prices.

At its core, the market remains adequately supplied. In April, output in the Lower 48 states is averaging approximately 110.7 billion cubic feet per day, nearing the peak levels observed in late last year. Simultaneously, storage levels remain adequate, as inventories increased by 50 bcf last week to reach 1.91 trillion cubic feet, maintaining stocks above both the previous year’s figures and the five-year average.

Weather forecasts indicating warmer-than-normal conditions through April are likely to restrict both heating and cooling demand, which is anticipated to maintain overall consumption at a slightly subdued level in the near term. In the future, the EIA anticipates an increase in production by 2026, despite a slight anticipated decline in demand before a subsequent recovery. LNG exports, however, are poised for steady growth, providing longer-term support.

From a technical perspective, the market is experiencing short covering, as evidenced by a 7.26% decline in open interest. Prices exhibit immediate support at Rs 242.2, with potential further decline towards Rs 239.8. On the upside, resistance is observed at Rs 246.8, and a breakout above this level could propel prices toward Rs 249.