Updated Aug 22, 2024
8/22/24
The pummeling continued in natural gas futures, with technicals suggesting additional losses amid a dearth of fodder to nourish the bulls. However, after controlling the market for six weeks, bears could be losing steam, opening the door for the bulls to run.
Natural gas futures bounced off seasonal lows on Tuesday, advancing for only the third time this month amid lighter production readings, bullish storage expectations and signs of new activity at a key export facility following damage caused by former Hurricane Beryl.
August natural gas futures were trading lower through midday Thursday after the latest weekly storage injection landed above historical levels.
Natural gas futures flipped negative through midday trading Tuesday after weather forecasts shaved off some of the Lower 48’s blistering heat expected over the next two weeks.
August natural gas futures began the week deep in oversold territory but with a clear line of sight on the next key technical support level should Hurricane Beryl cause significant demand destruction.
The flood of LNG poised to hit the global natural gas market later this decade is widely expected to push prices lower, potentially broadening the super-chilled fuel’s appeal in a way that could stoke more demand and help absorb the projected supply glut.
Energy executives working in the most prolific natural gas and oil region of the United States are forecasting Henry Hub prices will average $3.01/MMBtu at year’s end, according to the Federal Reserve Bank of Dallas.
Global natural gas prices continued to trade sideways on Monday as ample supplies were available and forecasts were largely unchanged.
The latest reported storage build matched most expectations, but provided no definitive directional support as natural gas futures vacillated between modest losses and gains in midday trading on Friday.
An increasing number of construction-related issues at major LNG projects this year has kept a demand-hungry natural gas market wary of delays, but analysts say price and production forecasts remain mostly intact – so far.