Natural Gas News Today: Natural Gas Market Faces Pressure as Hurricane Milton Looms – Can Prices Stay Above $3.00?

Key Points:

• Natural gas futures encounter resistance at the $2.937-$3.206 level, limiting gains around $3.00.
• Tropical Storm Milton’s development could lead to power outages in Florida, potentially reducing natural gas demand.
• The EIA reported a storage build of 55 Bcf, with inventories 190 Bcf above the five-year average, capping price increases.
• While cooler weather forecasts hint at heating demand, mild U.S. conditions could dampen the demand rise.
• Market Forecast: Bearish outlook due to high supply and potential hurricane-related demand suppression.

Natural Gas Market Analysis Amid Hurricane Concerns and Supply Levels

Natural gas prices recently faced resistance between $2.937 and $3.206, halting gains after testing the critical $3.00 level. With the emergence of Tropical Storm Milton, now forecasted to become a hurricane, the market faces potential shifts in gas demand. This storm is anticipated to bring significant power outages across Florida, likely reducing natural gas consumption and affecting overall demand.

Additionally, the latest Energy Information Administration (EIA) report showed a smaller-than-expected storage build of 55 billion cubic feet (Bcf). Despite this, storage remains significantly above the five-year average by 190 Bcf, continuing to cap price gains and maintaining a bearish tone.

Weather Outlook and Demand Projections

While cooler weather forecasts are hinting at an uptick in heating demand, mild temperatures across the U.S. might temper this increase. Overall, the near-term market outlook appears bearish due to anticipated power outages and the current storage surplus. This combination of factors might restrain any major rally in natural gas prices, keeping them from surpassing $3.00 sustainably.

Market Forecast: Bearish Sentiment for the Week Ahead

For the upcoming week, natural gas prices are expected to face continued pressure. Strong storage levels, potential hurricane impacts, and resistance around the $3.00 mark may collectively restrict any significant price advances. In the event of further declines, breaking below the $2.825 support level could trigger a sharper drop toward $2.610.

Conclusion: Prepare for Downside Risks

Traders should monitor upcoming weather developments and EIA reports, as these will provide further insights into demand expectations. With current market conditions signaling limited demand and ample supply, natural gas prices may struggle to break out of their current range in the near term.

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