Natural gas prices increased by 0.27% to close at Rs 301.6, bolstered by predictions of warmer-than-anticipated weather throughout the United States in the upcoming fortnight and a steady decrease in production levels. Anticipations of elevated temperatures extending into late June are expected to heighten electricity demand for air conditioning, consequently augmenting natural gas consumption by power utilities. According to data from LSEG, the average natural gas output in the U.S. is The Lower 48 states has experienced a decrease to 109.1 billion cubic feet per day thus far in June, in contrast to the 109.7 bcfd recorded in May.

The recent deceleration in production has contributed to a decrease in the inventory surplus, with storage levels now estimated to be about 5% above normal, a decline from roughly 6% in the preceding week. Demand prospects have shown signs of improvement, as total U.S. petrol consumption, inclusive of exports, is anticipated to rise from 102.6 billion cubic feet per day this week to 103.6 billion cubic feet per day next week. Storage data provided additional support to prices. U.S. utilities added 95 billion cubic feet of natural gas to storage for the week ending May 29, falling short of market expectations, which had anticipated a 101 Bcf increase.

Total inventories stood at 2.578 trillion cubic feet, slightly below year-ago levels but still comfortably above the five-year average, indicating adequate supply availability. Looking ahead, the U.S. Energy Information Administration anticipates that natural gas production will achieve unprecedented levels in the forthcoming years. Dry gas output is projected to increase from 107.7 billion cubic feet per day in 2025 to 110.6 billion cubic feet per day in 2026, and subsequently to 115.0 billion cubic feet per day in 2027. While domestic consumption is projected to decline modestly in 2026, demand is anticipated to rebound robustly in 2027.

Technically, the market is experiencing renewed buying interest, evidenced by a 5.54% increase in open interest to 18,715 lots, coinciding with a rise in prices. Immediate support is observed at Rs 297.3, with additional support at Rs 293.1. On the upside, resistance is likely at Rs 306.2, and a sustained move above this level could extend gains towards Rs 310.9.