Natural Gas Price Prediction – Prices Rise on LNG Supply Chain Issues
Natural Gas prices moved higher on Monday as the supply chain disruption of the mega-ship Ever Green generated LNG supply disruptions. The weather is expected to be much warmer than normal throughout the midwest. If it were not March and early April, this weather would generate significant cooling demand and potentially draws during the injection season. U.S. demand continues to decline as the heating season comes to a close.
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Technical Analysis
Natural gas prices moved higher on Monday up 1.3% and closing on the session highs. Support is seen near the 10-day moving average at 2.58. Resistance is seen near the 50-day moving average at 2.75. Medium-term momentum has turned positive as the MACD (moving average convergence divergence) index generated a crossover buy signal. This occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses above the MACD signal line (the 9-day moving average of the MACD line). The MACD histogram is printing in positive territory with an upward sloping trajectory which points to higher prices.
U.S. Demand Declines
U.S. demand continues to decline as the heating season comes to a close. Total U.S. consumption of natural gas fell by 5.6% compared with the previous report week. Natural gas consumed for power generation declined by 2.7% week over week. In the residential and commercial sectors, consumption declined by 12.9%. Industrial sector consumption increased by 0.1% week over week as industrial activity continued to recover from the effects of a winter storm from February 13 through February 17, which shuttered much of the U.S. Gulf Coast petrochemical industry.