Natural gas prices increased by 2.47%, concluding at Rs 281.70, bolstered by short covering and enhanced demand expectations. Market sentiment improved as forecasts indicated a rise in petrol consumption in the upcoming weeks, supported by heightened feedgas flows to the Freeport LNG export facility in Texas after previous operational setbacks. Fundamental indicators continued to exhibit a broadly supportive stance, even in the face of ample supplies. U.S. dry gas production in the Lower 48 states averaged 110.3 billion cubic feet per day in July, showing a slight increase from June levels, yet remaining below the peak of 110.6 bcfd recorded in December 2025.

Weather forecasts suggest that temperatures will stay elevated above the seasonal average until early August, which is likely to boost electricity demand for air conditioning and consequently elevate natural gas consumption. LSEG forecasts that total U.S. gas demand, inclusive of exports, will stabilise at approximately 111.5 bcfd, with LNG export flows maintaining an average of 17.4 bcfd throughout July. Storage data indicated a market in equilibrium.

The U.S. Energy Information Administration reported an injection of 41 billion cubic feet into storage for the week ended July 10, resulting in total inventories reaching 3,024 bcf. Inventories stand 6.4% above the five-year average; however, they are 0.7% lower than the same period last year, as robust LNG exports persist in absorbing a portion of the unprecedented domestic production. Looking ahead, the EIA anticipates that U.S. natural gas production and demand will achieve unprecedented levels over the next two years. Production is anticipated to reach 111.2 bcfd by 2026, whereas LNG exports are expected to grow to 17.4 bcfd in the upcoming year.

From a technical perspective, natural gas experienced short covering, as open interest decreased by 17.82% while prices increased. Immediate support is positioned at Rs 276.80, succeeded by Rs 272.00. Resistance is identified at Rs 284.40, and a sustained movement above this threshold may lead to further gains towards Rs 287.20, thereby upholding a favourable near-term technical perspective.