Natural Gas News: Bullish Weather Outlook Clashes With Cautious Market Sentiment

Natural Gas Futures Retreat as Heat-Fueled Rally Faces Technical Resistance

U.S. natural gas futures pulled back on Friday after a volatile session that initially extended this week’s rally. The market, which had surged past its 50-day moving average earlier in the week, ran into stiff selling pressure near the May 12 high of $4.186. While technical indicators remain bullish, today’s reversal underscores the persistent headwinds in a weather-driven market where rallies are more often sold than dips are bought.

At 13:58 GMT, Natural Gas futures are trading $3.963, down $0.026 or -0.65%.

Is the EIA Storage Build Keeping Bulls Cautious?

The Energy Information Administration (EIA) reported a 95 Bcf injection for the week ending June 13, slightly below consensus expectations of 96–98 Bcf. While the figure was above the five-year average build of 72 Bcf, it failed to deliver the 100 Bcf print needed to mark a record eighth consecutive weekly triple-digit build. Total storage now stands at 2,802 Bcf, 233 Bcf below last year’s level but still 162 Bcf above the five-year average. Traders appear to have priced in a tighter market outlook, and this marginally lighter injection may not be enough to justify further buying near current highs.

How Much Heat Is Already Priced In?

Weather models continue to show strong heat in the southern two-thirds of the U.S. and up the East Coast, with highs in the 80s to 100s through next week. High pressure is forecast to dominate the eastern half of the country, pushing national demand well above average. However, while hot weather has been a bullish driver, traders may be reassessing just how much of this expected demand is already baked into current prices. A pullback could signal a tactical repositioning rather than a change in the overall outlook.

Could the 200-Day Moving Average Come Into Play?

Despite the early-week breakout, the 200-day moving average near $3.60 remains a key longer-term support level. Today’s selloff, which saw prices slide from resistance near $4.18, could continue toward this level if bearish momentum gains traction. That said, the 50-day moving average is expected to offer initial support, though it’s not viewed as a strong floor in this market. The broader trend still favors higher prices, but traders remain wary of overextending long positions in a fundamentally weather-sensitive environment.

Market Forecast: Bullish, But With a Cautious Tone

The short-term outlook remains bullish, supported by strong heat-driven demand and tightening supply conditions relative to historical averages. However, the failure to break above the May highs and a lighter-than-hoped-for storage build suggest some near-term consolidation is likely. Expect further volatility, but as long as weather forecasts remain hot and LNG demand recovers, pullbacks could offer buying opportunities for traders with a disciplined entry strategy.

More Information in our Economic Calendar.