Indian Natural Gas Prices Decline on Warmer Weather Forecasts
Natural gas prices in India have declined as traders booked profits following forecasts of warmer weather and increased cooling demand. According to Kedia Advisory, natural gas settled lower by 2.64% at ₹276.1. The correction is attributed to recent price gains driven by forecasts for warmer weather and stronger cooling demand.
Despite the decrease in prices, fundamentals remain supportive due to increasing US natural gas demand from LNG export facilities. Major Texas plants, including the Corpus Christi facility and Freeport LNG, have returned from maintenance, contributing to higher demand. LSEG data shows that average Lower 48 gas production has increased to 111.4 billion cubic feet per day in August, up from the monthly record of 110.7 bcfd in July.
Average gas flows to nine major US LNG export plants stood at 17.2 bcfd in August, matching July's levels and remaining close to June's record of 17.4 bcfd. LSEG expects average Lower 48 demand, including exports, to decline from 112.7 bcfd this week to 111.1 bcfd next week, indicating some moderation in near-term consumption.
US natural gas inventories increased by only 15 bcf during the week ended August 21, below market expectations of 20 bcf. Total inventories reached 3.184 trillion cubic feet, around 0.9% below year-ago levels but still 5.5% above the five-year average.
The EIA expects both US supply and demand to reach record levels in 2026, with dry gas production forecast at 111.2 bcfd and domestic consumption at 92.0 bcfd. LNG exports are projected to increase to 17.4 bcfd in 2026 and 18.6 bcfd in 2027, supporting longer-term demand.
Techncially, the market is under fresh selling, with open interest rising 14.26% to 40,977 while prices declined ₹7.5. Natural gas is currently supported near ₹271.5, and a sustained break below this level could drag prices toward ₹267. On the upside, resistance is placed near ₹281, while a decisive move above this level could trigger recovery toward ₹286.