Natural Gas Price Fundamental Daily Forecast – Bullish Over $3.015, Bearish Under $2.988

Natural gas futures are trading steady-to-better early Wednesday after Tuesday’s U.S. Independence Day holiday.

At 0500 GMT, August natural gas futures are trading $2.988, up $0.004 or +0.13%.

Technical factors and weather-related news have been the driving forces behind the price action lately.

Technically, the market is trading inside a range, bounded by $2.875 to $3.122. Its 50% to 61.8% zone at $3.015 to $2.987 is controlling the price action. The market has tested the lower or 50% level at $2.987 the last two session.

We’re looking for a strong upside bias to develop on a sustained move over $3.015 and for the downside pressure to continue on a sustained move under $2.988.

In other news, natural gas-rich Qatar said on Tuesday it plans to increase natural gas production by 30 percent over the next several years, as it faces pressure from its neighbors in a diplomatic crisis.

Saad Sherida Al-Kaabi, the head of Qatar Petroleum, told a press conference that the emirate intends to raise production to 100 million tonnes of natural gas a year by 2024.

Qatar is the world’s biggest producer of Liquefied Natural Gas (LNG). Qatar’s current production is up to 77 million tonnes per year. The expansion will increase output levels up to the equivalent of six million barrels of oil per day, Kaabi said.

Traders are saying the timing of the announcement is both political and economic.

On Monday, Qatar gave its response to a 13-point list of demands its neighbors made for lifting their sanctions. Kaabi said Qatar wanted the production increase to be carried out through a joint venture with international companies. He also added, “If there are no companies willing to work with us, we will do the 100 million tonnes.”

The announcement comes just one day after the Trump administration announced the President will use fast-growing supplies of U.S. natural gas as a political tool when he meets in Warsaw on Thursday with leaders of a dozen countries that are captive to Russia for their energy needs.

Due to the U.S. bank holiday, the Energy Information Administration’s weekly storage report has been postponed until Friday. It is expected to show a 61 billion cubic feet build versus 46 bcf the week-ending June 23.