If $3.850 is not sustained, prices could accelerate towards $3.330, but continued cold weather and weak production levels make such a decline unlikely. It seems.
As of 12:42 (Japan time), natural gas futures are trading at $4.116, up $0.033 (+0.81%).
Will the EIA report be a bullish boost?
Today's EIA Weekly Storage Report will play a pivotal role in shaping market sentiment. Analysts expect storage withdrawals to be between 255 and 260 Bcf, significantly higher than the five-year average of -128 Bcf. The demand reflects increased heating demand due to the deep cold that hit two-thirds of the eastern United States.
Colder-than-normal conditions are keeping demand elevated, but milder temperatures in the western United States are providing some offset. Demand of this magnitude, combined with production challenges, could cause further increases in natural gas prices.
How will future Arctic explosions affect demand?
Demand is expected to briefly ease through Saturday, with temperatures across much of the U.S. in the 30s to 50s, according to NatGasWeather. However, the arrival of the Arctic blast between Sunday and Thursday is expected to bring lows to 20 to 20 degrees Celsius and highs of 0 to 30 degrees, especially in the Midwest, Texas and the South. This frigid weather is expected to significantly increase demand and create upward pressure on prices.
European LNG demand increases bullish mood
In Europe, imports of liquefied natural gas (LNG) are increasing as gas inventories are rapidly decreasing. According to Gas Infrastructure Europe, current storage capacity is 64%, down more than 15% from the same period last year. Analysts say European inventories could fall to 34% by the end of winter, and LNG imports will need to increase by 30% to meet the EU's 90% storage target for the 2025 heating season. We predict that there will be.
