Natural Gas News: Futures Hold Strong as Traders Eye EIA Report and Arctic Weather

U.S. Natural Gas Futures Edge Higher as EIA Report Looms

U.S. natural gas futures are climbing higher on Thursday, with prices holding above the key pivot level of $4.053. A decisive close above this threshold, coupled with bullish

Energy Information Administration (EIA) data, could propel prices to retest last week’s high of $4.369 and potentially target resistance levels at $4.442, $4.714, and $4.805. Conversely, a drop below $4.053 would signal weakness, exposing the market to a potential test of $3.850.

If $3.850 fails to hold, prices could accelerate toward $3.330, though such a sell-off appears improbable due to sustained cold weather and subdued production levels.

At 12:42 GMT, Natural Gas futures are trading $4.116, up $0.033 or +0.81%.

Will the EIA Report Deliver a Bullish Boost?

Today’s EIA weekly storage report is set to play a pivotal role in shaping market sentiment. Analysts anticipate a storage withdrawal of 255-260 Bcf, significantly exceeding the five-year average of -128 Bcf. This draw reflects the impact of frigid temperatures that gripped the eastern two-thirds of the U.S., driving heating demand higher.

Colder-than-normal conditions have kept demand elevated, while mild temperatures over the western U.S. have provided some offset. A draw of this magnitude, coupled with production challenges, could catalyze further upside for natural gas prices.

How Will Upcoming Arctic Blast Impact Demand?

According to NatGasWeather, a brief moderation in demand is expected through Saturday, with temperatures across much of the U.S. ranging from the 30s to 50s. However, an Arctic Blast set to arrive Sunday through Thursday will bring lows ranging from -20s to 20s and highs of 0s to 30s, particularly across the Midwest, Texas, and the South. This extreme cold is forecast to drive very high demand, creating upward pressure on prices.

European LNG Demand Adds to Bullish Sentiment

In Europe, rapidly depleting gas inventories are prompting an increase in liquefied natural gas (LNG) imports. Current storage is at 64% capacity, down over 15% from the same time last year, according to Gas Infrastructure Europe. Analysts project that European inventories could fall to 34% by winter’s end, necessitating a 30% increase in LNG imports to meet the EU’s 90% storage target for the 2025 heating season.

This heightened demand for LNG could influence U.S. export flows, adding further bullish momentum to natural gas prices.

Market Forecast

Natural gas prices are poised for further upside in the short term, supported by colder weather, strong heating demand, and robust LNG export activity. A bullish EIA storage report today could solidify this outlook, with resistance levels at $4.442 and $4.714 within reach. However, a break below $4.053 could temper the rally, exposing prices to a retracement toward $3.850. For now, traders should remain focused on the interplay between storage data and extreme weather conditions.

More Information in our Economic Calendar.