Natural gas prices finished just a fraction higher, inching up 0.07% to close at Rs 305. The slight lift came after US inventory numbers showed a smaller addition than most traders expected. Even so, the market could not run very far because overall production remains strong and supplies look comfortable enough to meet demand.
According to the US Energy Information Administration, energy firms pumped 77 billion cubic feet (Bcf) of gas into storage during the week ended October 16. That fell short of the 79 Bcf that analysts had penciled in. It was also well below last year's build of 86 Bcf and the five-year seasonal average of 87 Bcf. Total underground storage now sits at 3.644 trillion cubic feet. While that is roughly 4% lower than where supplies stood at this point last year, it still runs 1% above the historical five-year mark.
On the ground, field output across the Lower 48 states slowed down a bit in October, averaging 111.6 Bcf per day. That marks a drop from the all-time highs of 113.3 Bcf per day seen in August and September. At the same time, deliveries heading to major American LNG export plants picked up steam, climbing to 18.1 Bcf per day compared to 17.9 Bcf per day in September.
Long-Term Forecasts and Wall Street Caution
Looking further down the road, government projections show US dry gas production hitting 112.2 Bcf per day in 2026 and expanding to 116.1 Bcf per day in 2027. Local US consumption should also tick up, reaching 92.4 Bcf per day in 2026 and 93.8 Bcf per day the year after. Export pipelines will do some heavy lifting as well, with overseas shipments expected to reach 17.6 Bcf daily in 2026 and 18.6 Bcf in 2027.
Even with those demand numbers, big banks remain cautious. Goldman Sachs recently slashed its 2027 Nymex price estimate down to $2.80 per million British thermal units, down from its earlier target of $3.50. The bank pointed straight to booming output from the Permian Basin, noting that US supply gains will outpace domestic demand growth by more than 2 Bcf per day. Because of that heavy supply cushion, analysts do not expect any sharp, lasting price rallies anytime soon.
Technical Setup on the Charts
From a chart perspective, fresh buyers stepped into the market. Open interest jumped by 9.54% to settle at 38,508 contracts while prices ticked up by Rs 0.20, confirming that traders opened fresh long bets during the session.
For the sessions ahead, initial support sits at Rs 301, with secondary floor levels waiting around Rs 297.50. On the flip side, sellers are likely to step in near Rs 308 and Rs 311.50. If buyers can push and hold the market past Rs 308, prices could extend their run toward Rs 311.50. But if prices slip below Rs 301, expect fresh selling pressure to take over.
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Key Takeaways for Natural Gas Traders
- Short-Term Support: Storage builds are slowing down, which gives price pullbacks a soft cushion around the Rs 301 support zone.
- Heavy Supply Cap: Massive long-term production and pipeline supplies from the Permian Basin will keep a hard lid on runaway bull rallies.
- Critical Levels: Watch Rs 308 closely. A clean breakout above that level clears the path to Rs 311.50, while a breakdown below Rs 301 hands control back to short sellers.