Natural Gas prices declined by 0.36% to close at Rs 302.1, influenced by a modest rise in daily production and anticipations that storage levels will stay well above seasonal averages. Despite forecasts indicating warmer-than-normal temperatures through early July, which are expected to bolster cooling demand and elevate gas consumption by power generators, the market exhibited caution owing to the prevailing ample supply conditions. Approximately 40% of U.S. electricity generation is derived from natural gas-fired power plants, with elevated temperatures anticipated to maintain air-conditioning demand. However, slightly cooler weather forecasts for next week are anticipated to lead to a decrease in total gas demand, including exports, from 103.7 bcfd to 102.5 bcfd.

Supply fundamentals exhibited a degree of stability. Gas flows to the nine major U.S. LNG export facilities averaged 17.1 bcfd in June, remaining stable compared to May as a result of ongoing maintenance at several terminals. Nonetheless, exports continue to be considerably higher than historical averages. Meanwhile, the remnants of Tropical Storm Arthur are under observation, with a minimal likelihood of reemerging as a more potent weather system. Storage data presented a varied perspective. U.S. utilities added 73 billion cubic feet of natural gas to storage for the week ending June 12, which is marginally lower than the market’s forecast of 75 bcf.

Total inventories increased to 2.759 trillion cubic feet, representing a 5.8% elevation over the five-year average, although they remain slightly below levels from the previous year. Longer-term fundamentals continue to exhibit strong support, as the U.S. Energy Information Administration projects unprecedented levels of natural gas production, consumption, and LNG exports extending through 2027. Production is anticipated to rise from 107.7 bcfd in 2025 to 111.0 bcfd in 2026, with LNG exports expected to attain 17.2 bcfd in the coming year.

Technically, the market is witnessing long liquidation as open interest declined by 24.99% to 14,182 contracts while prices moved lower. Immediate support is seen at Rs 299.4, with further downside toward Rs 296.8. Resistance is placed at Rs 305.7, and a sustained move above this level could extend gains toward Rs 309.4.