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Natural gas futures firm at Rs 215.20 per mmBtu on lower inventory buildup

The momentum indicator Relative Strength Index (RSI) is at 65.70 which indicates upbeat movement in the prices.

Mumbai / April 30, 2021 / 02:54 PM IST

Natural gas futures jumped to Rs 215.20 per mmBtu on April 30 as participants increased their long positions as seen by the open interest. Natural gas had declined 1.71 percent yesterday on the NYMEX.

The energy commodity traded in the positive territory after a gap-up start in the afternoon session on lower inventory buildup.

The commodity has been trading higher than 5, 20, 50, 100 and 200 days' moving averages on a daily chart. The momentum indicator Relative Strength Index (RSI) is at 65.70 which indicates upbeat movement in the prices.

The US Energy Information Administration (EIA) reported that the country's natural gas inventories rose by 15 billion cubic feet (Bcf) for the week ended April 23 as against market expectations of a 24 Bcf rise. Natural gas in storage was 1,898 Bcf as of April 23, 2021.

Sriram Iyer, Senior Research Analyst at Reliance Securities said, “International natural gas futures have started marginally lower this Friday Morning morning and the early afternoon in Asian trade. Technically, NYMEX Natural Gas could trade in a range of $2.83-3 levels.”

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“Technically, MCX Natural Gas May supports are at Rs 211.35-208 whereas resistances are at Rs 220-225.25 levels”, Iyer added.

MCX iCOMDEX Natural Gas Index was up 10.01 points or 0.37 percent to 2,692.90.

In the futures market, natural gas for May delivery touched an intraday high of Rs 216 and an intraday low of Rs 214.50 per mmBtu on MCX. So far in the current series, natural gas has touched a low of Rs 184.10 and a high of Rs 222.90.

Natural gas delivery for May gained Rs 0.80, or 0.37 percent, to Rs 215.20 per mmBtu at 14:31 hours IST with a business turnover of 20,361 lots.

Natural gas delivery for June soared Rs 0.50, or 0.23 percent, to Rs 219.60 per mmBtu with a business volume of 2,546 lots.

The value of May and June’s contracts traded so far is Rs 520.97 crore and Rs 21.65 crore, respectively.

After sharp gains in the last few days, natural gas is showing some signs of correction which may extend further as weather-related demand subsides. Focus today will be on US weekly rig activity report, US weather outlook and trend in energy prices, said Kotak Securities.

At 0905 (GMT), the natural gas price dropped 0.45 percent quoting at $2.89 per mmBtu in New York.

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Sandeep Sinha

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