Natural gas remains range-bound between $3.10 and $3.35/mmBtu for the fourth consecutive week, reflecting a market in equilibrium between rising LNG export demand and steady domestic production.
LNG exports have been a consistent source of demand growth, with feed gas volumes rising 1.2 Bcf/day over the past month. Plaquemines LNG is expected to reach full capacity by Q1 2027, adding another 2.0 Bcf/day of demand. Long-term, the US LNG export capacity is set to nearly double by 2029.
On the supply side, dry gas production has stabilized near 103 Bcf/day after earlier expectations of a decline. Associated gas from the Permian has been the primary source of supply resilience, offsetting declining output from the Haynesville and Appalachian basins.
The gas-weighted rig count has fallen to 86, the lowest since 2023, but productivity gains mean that production per rig has increased 15% year-on-year. The market is witnessing a structural shift where fewer rigs produce more gas.
Summer demand peaks typically occur in July–August, driven by power sector cooling demand. With storage in a comfortable position and production robust, a heat spike would need to be significant and sustained to push prices above $3.50.
The range-bound market favors systematic hedging rather than directional bets. Use the $3.10–3.15 zone for base load additions and consider call spreads above $3.50 to manage upside risk from weather events. The structural LNG growth supports a $3.00 floor through 2027.