Natural Gas News: Resistance at $4.322 in Focus as Traders Eye Storage Data

Will Natural Gas Futures Hold Above Key Resistance

U.S. natural gas futures are edging lower Thursday, testing the key resistance level of $4.322. Initial selling pressure is expected at this level, but a breakout could lead to an acceleration toward $4.713–$4.901. Failure to breach resistance would indicate sellers are in control, potentially pushing prices down to $3.924, with further declines targeting the 50-day moving average at $3.756.

At 13:07 GMT, Natural Gas futures are trading $4.184, down $0.063 or -1.48%.

EIA Storage Report Signals Tight Supply

The market is anticipating Thursday’s EIA storage report, which follows a larger-than-expected draw of 62 Bcf last week. As of March 7, total working gas in storage stood at 1,698 Bcf—628 Bcf below last year and 230 Bcf under the five-year average. Traders expect a modest 3 Bcf injection for the week ending March 14, reflecting unseasonably warm temperatures.

Storage deficits continue to support prices, reinforcing concerns about tighter supply heading into the summer. U.S. gas inventories remain 27% lower year-over-year and nearly 12% below the five-year norm, keeping upward pressure on prices.

LNG Exports and Weather Support Prices

Rising LNG exports are adding to market strength, with flows to U.S. export terminals reaching 16.0 Bcf/day, up 16.6% from last week. A projected shortfall in gas storage this summer, estimated to be 10% below the five-year average, is fueling bullish sentiment.

Meanwhile, weather forecasts point to a cooler-than-expected start to April, particularly in the Midwest and East. This could drive a short-term demand boost for heating, providing additional price support.

Rig Count Declines, But Power Demand Rises

Baker Hughes reported a slight drop in active U.S. natural gas drilling rigs last week, down by one to 100, signaling a slower supply response. However, U.S. electricity demand is on the rise, with output up 7.8% year-over-year for the week ending March 8. Increased power generation could translate into stronger natural gas demand from utilities.

Market Outlook

If natural gas prices break above $4.322, bullish momentum could carry the market toward $4.713–$4.901. However, failure to sustain gains could lead to a retracement toward $3.924 and potentially lower. With storage levels tight, LNG exports rising, and cooler weather in the forecast, the market maintains a cautiously bullish bias.

More Information in our Economic Calendar.