Natural gas

Natural gas trade
Natural gas exports are the main driver of growth in U.S. natural gas demand in our forecast. Two liquefied natural gas (LNG) export facilities—Plaquemines LNG Phase 1 and Corpus Christi Stage 3—started production in December 2024. Two additional LNG developments—Golden Pass and Plaquemines LNG Phase 2—are expected to come online over the next two years. As a result, we forecast LNG exports to increase 22% in 2025 and 10% in 2026. Additional growth in natural gas demand comes from pipeline exports, which are forecast to increase by 8% in 2025 and 7% in 2026. In total, we expect natural gas exports to increase by 3.4 billion cubic feet per day (Bcf/d) in 2025 and 2.1 Bcf/d in 2026. Plaquemines LNG has ramped up production and exports of LNG faster than we had anticipated earlier this year, highlighting the uncertainty that project timelines can have on our natural gas balances.

Natural gas storage and prices
On April 30, 2025, the natural gas spot price at Henry Hub settled at $3.12 per million British thermal units (MMBtu), compared with $3.96/MMBtu on April 1, 2025. The average spot price in April was $3.44/MMBtu, down 68 cents/MMBtu from the March average.

Several factors contributed to the decrease in natural gas prices in March and April. Demand has remained steady, with more demand from increased U.S LNG exports offset by a warmer-than-normal start to spring, which brought lower levels of residential and commercial demand and stable demand in the electric power sector. Additionally, relatively high production of dry natural gas has contributed to lower prices.

These factors combined to bring natural gas inventories back to the five-year average (2020–2024) by the end of April. In March and April combined, natural gas injections into storage were 331 billion cubic feet (Bcf), compared with a five-year average injection of 135 Bcf. In our January STEO, we had forecast an injection of just 89 Bcf during March and April. Despite the strong storage injections the past two months, we now forecast less natural gas than is typical will be put into storage over the rest of the injection season, which ends on October 31. We forecast natural gas inventories will close the injection season 3% below the five-year average. We expect about 3,670 Bcf in storage at the end of October, compared with our January STEO forecast of about 3,720 Bcf.

With less natural gas in inventory, we now expect higher natural gas prices during the forecast period than we did in our January STEO, the first STEO to include forecasts for 2026. We expect the Henry Hub spot price to average $4.10/MMBtu in 2025 and $4.80/MMBtu in 2026, between $0.80–$1.00/MMBtu higher than we had forecast in January. January was colder-than-forecast, which led to a large draw from storage and contributed to our assumption that less natural gas will be held in storage during 2025 and 2026 than we had forecast going into this year. Additionally, we now forecast that there will be more demand for natural gas domestically and for U.S. exports of natural gas over the next two years than we had initially forecast. Finally, a drop in crude oil prices over the past three months has reduced our expectations for U.S. crude oil production growth, and we now expect less associated natural gas production than we did in January. Together, these factors mean we expect natural gas prices will be higher in order to incentivize production and keep markets balanced.