Natural gas prices decline as European supply concerns ease and technical resistance holds
Natural gas prices fall as European supply improves
Natural gas prices experienced downward pressure on Tuesday due to improved European supply conditions. TTF futures settled nearly 2.3% lower, marking the fourth consecutive session of decline.
Since peaking in early December, front-month TTF has dropped 18%, driven by progress in negotiations over Russian gas flows through Ukraine and increased LNG imports into Europe. European gas storage stands at 78%, below last year’s 89% but near the five-year average of 81%. A milder weather forecast for northwest Europe and expanded gas pipeline capacity have supported the market, reducing immediate supply concerns.
Natural gas chart (November 2024 - December 2024) Source: Trading View
Technical outlook for U.S. Natural gas
U.S. natural gas prices also declined, with NG futures trading near $3.06, down 0.52%. Technical indicators point to potential volatility. Support is established near $3.01, while resistance is seen at $3.14, aligned with the early October high. A breakout above this level could push prices toward $3.25 and possibly $3.35.
Failure to hold $3.01 could trigger a retest of the psychological $3.00 mark, with critical support at the early December low of $2.94. Analysts recommend caution as prices approach these technical benchmarks.
Traders remain focused on potential disruptions from geopolitical risks and changing weather patterns. Rising Asian demand for LNG and the uncertain future of Russian gas flows through Ukraine could drive further natural gas price volatility heading into early 2024.
Previously, we discussed natural gas prices reacting to LNG output developments and technical breakouts, emphasizing the influence of global market dynamics and weather-driven demand.
