Natural Gas Gains on Record Liquefied Natural Gas Exports

SEATTLE (Oil Monster):Natural gas prices experienced a 1.12% increase, settling at 217.2, attributed to record liquefied natural gas (LNG) exports. Despite this, a limited upside is expected due to forecasts of milder weather and reduced heating demand through late December. The abundance of open pipelines and robust gas flow to Europe suggests the continent is well-prepared for the winter. The US has significantly boosted oil and gas production, impacting global prices as President Biden aims to bolster the Democrats' position in the 2024 elections. 

A report indicates an LNG surplus until at least 2025, resulting from increased supply to replace Russian imports to Europe. Norwegian gas flow to Europe is notably high, surpassing the five-day moving average. Although Gaza tensions exist, they haven't disrupted gas flow from the Middle East to Europe. US utilities withdrew 117 bcf of gas from storage, exceeding expectations and last year's withdrawal, reflecting a proactive approach amid market dynamics. 

Technically, short covering is evident with a 5.41% drop in open interest, settling at 34482. Despite this, prices rose by 2.4 rupees. Support for natural gas is identified at 213.7, with a potential test of 210.2. Resistance is likely at 219.6, and a breakthrough could lead to a test of 222.

Courtesy: www.investing.com