U.S. Inventories Surge Last Week, Natural Gas Prices Under Pressure
The EIA report showed that natural gas inventories increased by 80 billion cubic feet (Bcf) as of the reporting period, higher than analysts 'consensus forecast of 61 billion cubic feet.
On October 24, the U.S. Energy Information Administration (EIA) released its latest weekly natural gas inventory report.The report showed that natural gas inventories increased by 80 billion cubic feet (Bcf) as of the reporting period, higher than analysts 'consensus forecast of 61 billion cubic feet.By comparison, natural gas inventories increased by 76 billion cubic feet last week.
Currently, natural gas inventories are 106 billion cubic feet higher than the same period last year and 167 billion cubic feet higher than the average of the past five years.The continued high inventory has become a major negative factor in the natural gas market, suppressing the room for price increases.
Natural gas prices fell immediately after the report was released.Inventory growth significantly exceeded market expectations, causing traders to quickly take profits after prices rebounded.At the same time, combined with weather forecast information, the market expects natural gas demand to remain sluggish this week.
From a technical perspective, natural gas prices have recently tried to break through the resistance level of US$2.40 to US$2.45.However, the EIA's bearish report has put significant pressure on natural gas prices, and it remains to be seen whether it can stabilize above US$2.45 in the short term.In terms of support, if the price falls below US$2.35, it may drop further into the support range of US$2.20 to US$2.25.Market volatility is likely to intensify as traders move to next month's contracts.
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