The last year has been a rollercoaster from unprecedented geopolitical pressures pushing U.S. liquified natural gas (LNG) exports to increasing demand in the U.S. market. We saw the Henry Hub Monthly Spot Price climb from $4.38 per million British thermal units (MMbtu) in January to $8.81 in August. Now, with larger-than-expected storage injections this fall and warmer-than-expected forecasts, natural gas prices retreated to a monthly price of $5.66 MMbtu in October.  

Domestic Demand  

Domestic demand for natural gas has remained steady, with a 2.2 percent increase from this time last year, according to the Energy Information Administration’s (EIA) weekly natural gas report.  

International Demand    

Warmer weather in Europe brought relief to many consumers as prices fell. Although the warm weather has pushed back prices from all-time highs, natural gas in Europe is still around four times more than average at this time of year. Europe’s gas storage sites are nearly 95 percent full; this will help provide a buffer for when the weather turns cold. While supply problems for this winter are decreasing, next year could be more complex because stockpiling might be more difficult without the typical Russian supply.  

Production & Supply  

Over the last year, U.S. producers have been expanding production to meet growing demand in the U.S. and globally. Natural gas rigs are up 52 percent from this time last year, and this has helped produce larger-than-expected natural gas storage injections. With five consecutive triple-digit increases in September and October, the U.S. is now just 3.7 percent under the five-year average in storage.  

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