Natural Gas Price Forecast – Natural Gas Breaks Down Again

Natural gas markets fell again during the trading session on Wednesday, reaching down towards the 1.60 level underneath. At this point, the market has seen quite a bit of support in that area over the last couple of weeks, so the question now is whether or not the market can find buyers there again, or if it breaks down. With the inventory figure coming out we could get that answer rather rapidly. It’s hard to imagine that the demand for natural gas is going to be huge, due to the fact that everything is slowing down with the coronavirus shutting down economies. Furthermore, we also have to keep in mind that the weather is starting to roll over and we will see warmer temperatures rather soon in the northern hemisphere which will crush demand.

NATGAS Video 19.03.20

On the other side of the equation though is the fact that we are at such low levels it’s hard to believe that we are going to go significantly lower, because sooner or later we are going to have bankruptcies in this sector, which will be one of the best ways to kill oversupply issues in the market. Granted, it’s going to be a very painful and messy when that happens, but the longer-term outlook for natural gas is always going to be negative because there is so much out there. At this point, the $2.00 level looks to be very resistive, just as the $1.80 level will be as well based upon the recent trading action.