What can natural gas, US dollar tell about recent financial markets’ performance?

The Natural Gas Index (XNG/USD) is trading at $2.637 MMBtu, at the time of writing, entering the US session on Thursday. Natural gas price pulls back after gas storage data beats estimates. In other words, natural gas corrects on intraday charts after Natural Gas Storage data shows an unexpected rise in inventories.


The commodity had been recovering and benefiting from the current heatwave demand due to power demand for air conditioning. Norwegian outages continue to ravage the supply outlook and further underpinned prices. If temperatures across the Western world continue to remain elevated, Natural Gas could see further gains.


Natural gas price trades flat on Thursday after Natural Gas Storage Change data from the Energy Information Administration shows a surprise rise in inventories, indicating robust supply paring earlier gains.


Gas prices had been recovering due to a mixture of a weaker US Dollar and hotter-than-expected summer weather in the Western world. Temperatures in Texas, for example, are breaking records and the trend is set to continue for 7-10 days, according to forecasters. If the summer is hotter overall, it will quickly put pressure on Natural Gas supplies used in air conditioning.

EIA Natural Gas Storage Change data shows a rise to 95 billion cubic feet (bcf) in the week to June 16, when a lower 91 bcf had been forecast from 84 bcf recorded in the previous week. The data suggests robust supply in the US and as a result natural gas prices dip lower.