Natural gas futures climb 1.81% to Rs 197.40 per mmBtu, outlook mixed

Natural gas futures climbed to settle at Rs 197.40 per mmBtu on December 18 as participants trimmed their position as seen by the open interest. Natural gas price had risen 3.13 percent during the week.

Natural gas demand for industrial sector jumped to 24.5 billion cubic feet (BCF) per day, while the power usage lower to 27.1 Bcf/d, according to PointLogic Energy.

The weather continues to be unusually warm in the winter season, the overall demand for natural gas is expected to be lower.

The US Energy Information Administration (EIA) reported that US natural gas inventories dropped by 122 billion cubic feet (bcf) for the week ended December 11.

MCX iCOMDEX Natural Gas Index was up 33.28 points, or 1.39 percent to 2,433.42.

Sunand Subramaniam, Senior Research Associate, Choice Broking said, “Fundamentally for the weeks ahead, we are estimating MCX Natural Gas futures to trade mixed in expectancy of steady supplies and demand/usage and fall in inventories observed on a weekly basis.”

He also said that the US CPC further expects warmer weather conditions for the next 6-10 days. This is expected to pressure prices in the week ahead. Overall, we expect the mixed trend in MCX Natural Gas futures in the coming week, Subramanium noted.

In the futures market, natural gas for December delivery touched an intraday high of Rs 200.30 and an intraday low of Rs 195.10 per mmBtu on MCX. So far in the current series, natural gas has touched a low of Rs 175.90 and a high of Rs 259.80.

Natural gas delivery for December gained Rs 3.50, or 1.81 percent to settle at Rs 197.40 per mmBtu with a business turnover of 8,016 lots.

Natural gas delivery for January soared Rs 2.40, or 1.23 percent, to close at Rs 197.10 per mmBtu with a business volume of 1,973 lots.

The value of December and January’s contracts traded on December 18 was Rs 3,765.79 crore and Rs 171.42 crore, respectively.

Natural gas price settled with a gain of 2.73 percent quoting at $2.70 per mmBtu in New York.

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