A day after selloff, natural gas futures slip 1.02% to Rs 222.80 per mmBtu

Natural gas futures dropped to Rs 222.80 per mmBtu on February 19 as participants increased their short positions as seen by the open interest. Natural gas prices had declined 4.6 percent yesterday on the NYMEX.

Natural gas pared losses after a gap-down start in the afternoon session tracking recovery in global prices.

As per Refinitiv Eikon data, US daily natural gas production has fallen roughly 17 percent from the end of last week to 72.1 billion cubic feet per day on Wednesday.

The US Energy Information Administration (EIA) reported that US natural gas inventories fell by 237 billion cubic feet (Bcf) for the week ended February 12.

Sriram Iyer, Senior Research Analyst at Reliance Securities said, “International natural gas futures have started marginally in the green this morning and early afternoon in Asia trade. Technically, NYMEX Natural Gas could trade in a range of $2.98-3.20 levels in the coming session.”

“Technically, MCX Natural gas took resistance near Rs 239 levels and ended on a negative note with more than 4 percent losses and could witness further downside momentum up to Rs 221-225 levels whereas resistance is at Rs 226-230 level,” Iyer noted.

MCX iCOMDEX Natural Gas Index was down 13.18 points or 0.46 percent to 2,829.91.

In the futures market, natural gas for February delivery touched an intraday high of Rs 223.80 and an intraday low of Rs 218.70 per mmBtu on MCX. So far in the current series, natural gas has touched a low of Rs 169 and a high of Rs 239.80.

Natural gas delivery for February slipped Rs 2.30, or 1.02 percent, to Rs 222.80 per mmBtu at 14:31 hours IST with a business turnover of 9,701 lots.

Natural gas delivery for March fell Rs 1, or 0.46 percent, to Rs 214.80 per mmBtu with a business volume of 3,787 lots.

The value of February and March’s contracts traded so far is Rs 1,111.14 crore and Rs 69.46 crore, respectively.

Kshitij Purohit, Product Manager, Currency & Commodities, CapitalVia Global Research Limited, said: “Natural gas traded negative during the last trading day, the weather is expected to be warmer than normal throughout most of the East Coast and Midwest for the next 2-weeks but cooler on the West Coast. Natural gas has support at Rs 220 levels below it may come down to Rs 214 levels. While resistance for the energy is at Rs 224, above this, natural gas can go towards Rs 230 levels.”

At 09:05 (GMT), the natural gas price marginally up 0.19 percent quoting at $3.08 per mmBtu in New York.

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