Natural Gas Futures Struggle Below Key Level Amid Milder Weather

Natural gas futures are trading below their 50-day moving average at $3.041 after failing to hold the $3.087 level. The market's main trend remains up, but a trade through $2.976 could signal a change in direction.

The latest weather forecasts have turned milder across the Midwest and East Coast, reducing early October heating demand. Cooling demand in the South Central and Southeast is also fading.

End-of-October storage levels are projected to be near 3,985 billion cubic feet (bcf), the highest in a decade and 5% above the five-year average. The Energy Information Administration (EIA) has also raised its 2027 dry natural gas production forecast to 116.0 bcf per day.

Despite tightness in Europe, China's LNG demand is not pulling prices up in the US. EU gas storage is about 71% full against an 87% five-year seasonal average. QatarEnergy has extended a force majeure on LNG supplies to Italy's Edison through December.