Natural Gas – Searching for a Bottom
- Timothy Beggans
- Aug 12
- 1 min read
Natural gas prices are still looking for a floor as bullish and bearish forces compete in late summer 2025. Forecasts point to an average of $3.40/MMBtu in Q3.
Demand is firm. U.S. electricity use continues to run above 2024 levels—up 3% last year—driven by heatwaves and steady industrial load. Coal consumption rose 12% y-o-y in the first half of 2025, showing active fuel switching. Nuclear refueling outages are averaging ~3 GW this summer (vs. ~1.3 GW in 2024), boosting gas-fired generation.
Storage is balanced but mixed. U.S. inventories are 3,130 Bcf—4.2% below last year but 5.9% above the five-year average. Europe’s gas storage is around 72% full, potentially lagging 2024, raising concerns ahead of winter.
Exports remain a key support. U.S. LNG feedgas demand is averaging 16.3 Bcf/d, near record highs, as global buyers secure supply before the Northern Hemisphere winter.
The search for a bottom reflects the tension between healthy inventories and firming demand signals. Any early cold snaps in Europe or the U.S., sustained LNG flows, or continued coal-to-gas switching could tighten balances and lift prices.
Key Data Snapshot (Aug 2025)
U.S. Storage vs. Last Year: -4.2% (EIA)
U.S. Storage vs. 5-Yr Avg: +5.9% (EIA)
Coal Consumption (H1 2025 Y-o-Y): +12% (IEA)
Nuclear Outages: ~3 GW (EIA/NRC)
LNG Feedgas: 16.3 Bcf/d (EIA)
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