Natural gas concluded the trading session with a decline of 1.16%, settling at Rs 290.3. This decrease was influenced by predictions of reduced demand and anticipations of increased production in the United States, particularly following the resumption of operations at the Mountaineer XPress pipeline in West Virginia. In September, natural gas production in the contiguous United States reached an average of 112.2 billion cubic feet per day, marginally lower than the record high of 112.3 billion cubic feet per day recorded in August. Over the past week, output averaged 109.4 billion cubic feet per day, influenced in part by a temporary disruption on the Mountaineer XPress pipeline.
Record production and mild spring weather have maintained US petrol inventories above the five-year average since March, achieving a level 7.7% above normal in April. LSEG anticipates an increase in Lower 48 gas demand, encompassing exports, from 102.6 bcfd this week to 105.1 bcfd next week, attributed to a seasonal decline in temperatures. The EIA reported a 53 bcf storage injection for the week ended September 18, aligning with market expectations yet falling short of the 77 bcf build noted in the corresponding week of the previous year and the five-year average increase of 76 bcf. The EIA anticipates an increase in US dry gas production, forecasting a rise from 107.6 bcfd in 2025 to 111.2 bcfd in 2026 and further to 116.0 bcfd in 2027.
Concurrently, domestic consumption is expected to reach 92.0 bcfd in 2026 and 94.8 bcfd in 2027. LNG exports are projected to rise from 15.1 bcfd in 2025 to 17.4 bcfd in 2026 and further to 18.6 bcfd in 2027, despite a minor reduction in the 2026 forecast due to maintenance activities at Freeport LNG. Technically, natural gas is experiencing renewed selling pressure, as evidenced by an 11.83% increase in open interest to 46,644, alongside a price decline of Rs 3.4. Support is positioned at Rs 286.2, and a breach beneath this threshold may lead to a further decline toward Rs 282. On the upside, resistance is observed at Rs 294.7, while a sustained move above this level could initiate a recovery toward Rs 299.
