Weak seasonal demand and higher production are weighing on prices

A surge in natural gas production combined with continued weak demand has put downward pressure on prices. Seasonal factors are contributing to weaker demand, with forecasts predicting mild weather across much of the United States over the next week. According to NatGasWeather, weather systems are expected to keep temperatures cool across the northern US, but most of the country will experience mild conditions, reducing heating demand. This lack of weather-dependent demand tempers the chance of a substantial price increase.

Global supply brings convenience, adding to bearish sentiment

In Europe, natural gas prices fell on Monday as initial supply fears eased following recent conflicts in the Middle East. Supply chains remain largely intact and significant disruptions to natural gas flows have been avoided despite increased geopolitical tensions. This global stability has further reduced bullish support for US prices as European demand for LNG, a key driver of US exports, shows limited volatility.

Market forecast

Given the current market situation, bearish sentiment is expected to persist in the short term as long as demand remains weak and production levels remain high. A decisive break below the support at USD 2,764 could send prices lower towards USD 2,585, while the market’s upside potential is limited by technical resistance levels around USD 3.10.