Natural gas storage is increasing faster than projected, but will this lead to a rally?
On June 12, 2025, the US Energy Information Administration (EIA) reported that natural gas storage had increased by 109 billion cubic feet (Bcf) over the previous week. This figure is significant in the grand scheme of things, even though it is just slightly higher than the analysts’ prediction of 108 Bcf. Storage levels are currently 139 Bcf higher than the five-year average, but they remain 256 Bcf lower than they were this time last year.
Even when demand is declining, inventory building continue to increase.
Even while the build is favorable, there appears to be little immediate demand pressure. The weather forecast for the next week predicts mild temperatures in high-demand areas, particularly in the Midwest and Northeast. This means there will be less need for cooling. This moderation can be evident in futures prices, which remain cautious despite technical indicators pointing to an upward trend.
According to NOAA’s 8-14 Day Outlook, cooler weather trends will persist until mid-June, causing households and businesses to use less energy.
Traders Look for Technical Breakout Zones
Natural gas is currently trading near a crucial resistance level of $3.60-3.65. If this zone is broken, prices may move to $3.85 or higher. The Relative Strength Index (RSI) is currently in the neutral range, indicating that a rally could occur if new demand reasons, such as a sudden heat wave or output cuts, emerge.
As we approach the high summer season, the additional storage may help keep things stable in the short term. However, long-term patterns will be determined by changes in the weather and global LNG demand.
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