Natural gas

January natural gas consumption trends
Monthly natural gas consumption in the United States typically peaks in January when demand for space heating is usually at its highest. We forecast natural gas consumption in January 2025 will average 119 billion cubic feet per day (Bcf/d), about the same as in January 2024.

U.S. natural gas consumption during the winter heating season (November–March) has become more variable as winters have generally become warmer, but periods of extreme cold could still happen. Because of warmer-than-normal temperatures in January and February 2023, natural gas consumption reached multi-year lows for those months. However, cold snaps resulting in spikes in consumption still occur, as happened last year when natural gas consumption set a new daily high on January 16, according to S&P Global Commodity Insights. Consumption in January has the potential to set natural gas price trends for the year. Through the first 12 days of this January, there have been below normal temperatures in much of the United States, and S&P reports natural gas consumption in the Lower 48 States has averaged 115 Bcf/d, up from an average of 105 Bcf/d during that period last year. If cold weather persists for an extended period and continues to increase natural gas consumption, natural gas inventories will likely be reduced below our forecast levels, resulting in higher natural gas prices.

Natural gas supply and demand
Over the next two years, we expect that natural gas demand in the United States will generally grow by more than natural gas supply. In 2025, we forecast supply of natural gas, including both production and imports, will rise by 1.4 Bcf/d in 2025, while demand for natural gas, including domestic consumption and exports, rises by 3.2 Bcf/d.

Exports are the leading source of natural gas demand growth in our forecast. We expect exports of natural gas by pipeline and as liquefied natural gas (LNG) to increase by 2.9 Bcf/d in 2025, with most of the increase coming from LNG exports. Two new LNG export facilities—Plaquemines LNG and Corpus Christi LNG Stage 3—started producing LNG in December 2024, and Plaquemines LNG loaded and shipped its first LNG cargo on December 26.

We also forecast consumption in the residential and commercial sectors to increase in 2025 because we expect colder weather than in 2024. However, we forecast a decrease in consumption in the electric power sector this year as natural gas prices rise and more renewables and coal are used to generate electricity, displacing some natural gas-fired generation capacity.

We estimate that the United States began 2025 with 6% more natural gas in storage than the previous five-year average. With demand growth outpacing supply growth this year, we expect inventories will be drawn down to 4% below the five-year average by the end of 2025. As the storage surplus of the last two years diminishes, we expect some upward pressure on prices.

In 2026, we forecast natural gas supply will grow by about the same amount as demand. We expect storage inventories will remain close to or below the five-year average much the year, leading to additional price increases in 2026.

We forecast demand for natural gas will again be driven mostly by growth in LNG exports as additional LNG export capacity from Golden Pass comes online in the middle of the year. LNG exports grow by 2.1 Bcf/d in 2026 to reach an average of 16.2 Bcf/d. Additional demand growth in 2026 comes from pipeline exports, while consumption of natural gas in the residential, commercial, and electric power sectors all decline slightly. Supply growth in 2026 is driven by an increase in dry natural gas production of 2.7 Bcf/d.

Natural gas prices
In our forecast, the annual U.S. benchmark Henry Hub spot price averages $3.10 per million British thermal units (MMBtu) in 2025 and rises to almost $4.00/MMBtu in 2026. Our expectation that natural gas inventories remain at or below previous five-year averages during the forecast period puts upward pressure on natural gas prices. The monthly Henry Hub spot price in our forecast remains between $2.50/MMBtu and $3.90/MMBtu in 2025 and between $3.50/MMBtu and $4.40/MMBtu in 2026 as LNG exports increase.

Although we expect the Henry Hub price to rise from their all-time lows in 2024 over the forecast period, the potential exists for prices to increase by less than we forecast, particularly if the ramp-up of new LNG production is slower than expected or the start-up of the Golden Pass facility is delayed. Additionally, weather continues to present a significant risk to our Henry Hub price forecast, particularly in the winter months.