US Natural Gas Production to Rise in 2025 as Prices Surge on Heating Demand
US natural gas production is set to rise in 2025, while inventories have been growing steadily. Recent weather forecasts indicate increased demand for heating, pushing prices up.
US natural gas production is expected to increase by 0.5% to 107.14 bcf/day by 2025. This follows a year-on-year rise of 3.7% in lower-48 dry gas production, reaching 105.9 bcf/day on Tuesday. Despite this growth, natural gas inventories have been rising, albeit below market expectations and 5-year averages. As of September 26, inventories stood at +5.0% above their 5-year seasonal average.
The official weather forecasts for mid-October, published by the National Weather Service (NWS) under the National Oceanic and Atmospheric Administration (NOAA), indicate cooler temperatures. This is expected to boost heating demand for natural gas. Consequently, lower-48 state gas demand on Tuesday was 69.0 bcf/day, a decrease of 5.8% year-on-year. This cooling trend has also driven up prices, with November Nymex natural gas (NGX25) closing up by 0.141 (+4.20%).
Despite record high production levels and increased active rigs, natural gas inventories remain below expectations. Cooler weather forecasts suggest increased heating demand, which, coupled with rising production, could stabilize prices in the coming weeks.
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