U.S. natural gas production has proven remarkably resilient despite lower prices, averaging above 108 Bcf/d through early June. The key driver is associated gas from record Permian Basin oil production, which continues to generate approximately 22 Bcf/d of gas as a byproduct. This associated gas is largely price-inelastic, meaning it will continue flowing even if standalone gas prices weaken.
LNG feedgas demand has dipped in early June to 16.3 Bcf/d, down from 17.1 Bcf/d in May, due to seasonal maintenance at Golden Pass, Freeport, and other liquefaction plants. However, once maintenance concludes in July, feedgas demand is expected to rebound toward record levels as new LNG capacity at Corpus Christi Stage 3 and Golden Pass ramps up.
The structural growth in LNG export capacity is the most significant long-term driver of U.S. gas demand. By 2028, total U.S. LNG export capacity is expected to exceed 20 Bcf/d, nearly doubling from 2024 levels. This will progressively tighten the domestic gas market, particularly during winter months when both heating and export demand peak simultaneously.
Global natural gas benchmarks have risen sharply since the geopolitical turmoil began in late February 2026, with TTF up 48% and JKM up 83%. The wide spread between Henry Hub and global prices supports strong LNG export economics, ensuring that U.S. LNG facilities operate at maximum capacity once maintenance is complete.
The growing disconnect between domestic U.S. gas prices (supported by abundant associated gas) and global LNG prices (driven by geopolitical risk) creates a two-tier market. Buyers with access to domestic U.S. supply should prioritize it over LNG-linked contracts. The structural LNG export growth means the 'Henry Hub ceiling' is gradually rising.