Dry gas production remains robust at 104.4 Bcf/day, up +3.8% year-over-year, according to BloombergNEF. In contrast, demand is softening, down -7% year-over-year to 66.8 Bcf/day, while LNG feedgas flows slipped -3% week-over-week to 15.3 Bcf/day. This widening gap between strong production and sluggish demand continues to build downside pressure, with storage likely to climb without a pickup in either domestic or export consumption.
Will Mild Weather Further Depress Demand?
The outlook for April 24–30 calls for mostly mild temperatures across the U.S., with highs in the 60s-80s, cooler 50s in the Northern Plains, and isolated 90s in the far South. This pattern will result in light to very light national gas demand over the next seven days, reducing the chances for a meaningful near-term price recovery.
What Does the Baker Hughes Rig Count Indicate?
Baker Hughes reported Friday that the U.S. natural gas rig count rose by +1 to 99 rigs. Although modest, the increase marks a slight recovery from the recent four-year low of 94 rigs seen last September. However, the overall rig count remains well below the post-pandemic peak of 166 rigs, suggesting producers are cautious about aggressively expanding supply at current low price levels.
Could Rising Electricity Demand and LNG Expansion Offer Support?
Electricity demand is trending higher, with Edison Electric Institute reporting a +2.1% year-over-year increase for the week ending April 19. This could offer some seasonal demand lift as cooling needs grow. Longer-term, President Trump’s removal of the LNG project approval pause is supportive, with expanded export capacity likely to boost gas demand in future years.
Market Forecast: Short-Term Bearish Bias
Despite Friday’s technical rebound, natural gas fundamentals remain bearish. Strong production, weak seasonal demand, a bearish storage trend, and mild weather are all weighing on the market. Traders should anticipate additional selling pressure unless signs emerge of tighter production or significantly hotter weather patterns.
More Information in our Economic Calendar.