Market Speak: EIA projects steady natural gas supply, prices to climb this winter

The EIA?s latest Short-Term Energy Outlook (STEO) expects the Henry Hub natural gas spot price to average around $3.00 per MMBtu in Q3 2025, supported by high inventories and strong production. In August, inventories ended 6% above the five-year average, contributing to the lower-than-expected price of $2.91/MMBtu. Reduced demand from the electric power sector also weighed on prices this summer. However, the STEO forecasts a gradual price increase this winter, driven by faster-than-normal inventory withdrawals and rising LNG exports, while U.S. production flattens. The Henry Hub price is projected to peak at $4.60/MMBtu in January 2026, with inventories expected to finish the winter season just 1% above the five-year average. This signals tightening supply amid growing export demand and seasonal heating needs.

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