NATGAS retreats from $ 8 MMBTU area
Price of natural gas pulled back sharply, despite the still high uncertainty related to the potential suspension of exports from Russia to European Union. At the moment, Hungary strongly opposes the idea of imposing further sanctions on Russia. Germany and Austria also speak in similar manner.
Downward move occured, despite a short-term increase in demand from the US, caused by low temperatures in some parts of the country. At the moment, US gas inventories are approx. 18% below the 5-year average, but at the same time they remain at a very high level in terms of annual consumption. The demand in this period is approx. 15% higher compared to last year.
Start investing today or test a free demo
Open real account TRY DEMO Download mobile app Download mobile appGas is retreating as new forecasts indicate a decline in global demand for this commodity in 2022, mainly due to Russia's attack on Ukraine. In addition, Cheniere, one of the largest LNG exporters in the world, indicates that due to the global price increase, there will be an increase in the production of gas itself and an increase in LNG exports, which may in the long term limit price increases. Goldman Sachs also believes that current gas pricing is driven primarily by concerns rather than short-term or long-term fundamental factors.
NATGAS price fell from its 14-year highs around $ 8.0 which was marked with the 50.0% Fibonacci retracement of the last downward wave launched in 2008. If sellers manage to push the price below $7.0, then downward move may accelerate towards the key support area around $ 6.2-6.3 MMBTU. Source: xStation5
