U.S. natural gas consumption is on track to set a new record in 2025, according to the Energy Information Administration. In its latest Short-Term Energy Outlook, the agency projected demand will average 91.4 billion cubic feet per day, up from 90.5 bcf/d in 2024. January usage climbed to 126.8 bcf/d, 5% higher than the same month a year earlier, reflecting colder conditions and steady heating requirements.
Natural gas continues to show strong resilience. Despite rapid additions of renewable generation, natural gas remains the dominant fuel for electricity production, underpinned by competitive prices and flexible supply. Industrial facilities, especially petrochemicals, continue to absorb large volumes, reinforcing the fuel’s central role in U.S. manufacturing.
Market pricing reflected a modest decline. At mid-day on Monday, Henry Hub natural gas traded at $2.677 per MMBtu, down 0.70% from the previous session. Prices remain under pressure from high storage inventories and steady production, even as annual consumption is set to hit new records.
Fundamentals remain heavy. Working gas stocks stand at 3,199 Bcf, or around 6% above the five?year average, according to the latest EIA storage report. EIA’s weekly update also shows dry gas production averaging 107.4 Bcf/d last week (up from 101.8 Bcf/d a year earlier), keeping supply elevated. NOAA’s population?weighted degree?day outlook for the week into August 30 indicates national cooling demand roughly near to slightly below normal, limiting late?August power?burn upside even as the EIA projects record 2025 consumption in its latest forecast.
The EIA also emphasized the growing influence of exports. Several new liquefaction trains are scheduled to begin operations in 2025, lifting liquefied natural gas shipments and extending America’s lead as the world’s top exporter. The agency expects LNG demand from Asia and Europe to absorb a significant share of incremental U.S. output, with global buyers seeking secure supply amid ongoing geopolitical disruptions.
With domestic demand rising and export capacity expanding, U.S. natural gas markets face a sharp contrast between bearish short-term pricing and bullish long-term fundamentals.
By Charles Kennedy, Oilprice.com – Aug 25, 2025
