📉NATGAS plunges 10.0%💥

Mild weather forecasts put pressure on gas prices

NATGAS price broke below $6.0/MMBtu at the beginning of new week as forecasts of milder weather may lowere heating demand in late December. Last week, NATGAS added 5% amid signs of robust foreign demand and a drop in domestic output. Last Thursday natural gas flowing towards US LNG terminals jumped to 13 bcf per day, a level not seen since June, which indicates solid international demand. At the same time, extreme low temperatures from North Dakota to Texas caused pipes and gas wells to freeze, which negatively affected production. Meanwhile, the Freeport LNG export plant in Texas, which is not working since June, expects to resume operations at the end of December, leaving more supply on the US market.

Meanwhile EU countries agree on a gas price cap of €180/mwh (up from €175/mwh originally suggested) that will take effect on February 15th.

From technical point of view, NATGAS price extends Friday sell-off and is moving toward a 5-month low of $5.30/MMBtu hit on December 6th. Earlier, sellers may face a local support at 5.72, which is marked with previous price reactions.

NATGAS, H4 interval. Source: xStation5