Natural gas futures flat at Rs 200 per mmBtu on lower inventory build up

Natural Gas

Natural gas futures were steady at Rs 199.70 per mmBtu on April 16 as participants increased their long positions as seen by the open interest. Natural gas had risen 1.5 percent on April 15 on NYMEX.

The energy commodity pared losses and turned positive after a gap-down start in the afternoon session, tracking firm global cues.

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 58.55, which indicates bullish momentum in the prices.

The US Energy Information Administration (EIA) reported that the country's natural gas inventories rose by 61 billion cubic feet (Bcf) for the week ended April 9 as against market expectations of a 67 Bcf rise. Natural gas in storage was 1,845 Bcf as of April 9, 2021.

The weather is expected to become colder than normal for most of the mid-west for the next 6-10 days and then moderate.

Sriram Iyer, Senior Research Analyst at Reliance Securities said, “International natural gas futures have started flat this Friday morning and traded firm in the early afternoon in Asian trade. Technically, NYMEX Natural Gas could trade in a range of $2.55-$2.90 levels.”

“Technically, MCX Natural Gas April hold resistance near Rs 202-Rs 206 levels and has support near Rs 198-Rs 195 levels”, Iyer added.

MCX iCOMDEX Natural Gas Index was slightly down 2.50 points or 0.10 percent to 2,561.51.

In the futures market, natural gas for April delivery touched an intraday high of Rs 200.40 and an intraday low of Rs 198.30 per mmBtu on MCX. So far in the current series, natural gas has touched a low of Rs 179.80 and a high of Rs 223.

Natural gas delivery for April gained Rs 0.20, or 0.10 percent, to Rs 199.70 per mmBtu at 14:43 hours IST with a business turnover of 15,636 lots.

Natural gas delivery for May fell Rs 0.10, or 0.05 percent, to Rs 204.80 per mmBtu with a business volume of 8,610 lots.

The value of April and May’s contracts traded so far is Rs 757.18 crore and Rs 43.24 crore, respectively.

Natural gas has edged up in the last few days but continues to trade within the broad range of $2.45-2.7/mmBtu, hence fresh buying should be only on dips, said Kotak Securities.

At 09:16 (GMT), the natural gas price jumped 1.02 percent and was quoting at $2.68 per mmBtu in New York.

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