Natural Gas (NG=F) Rebounds to $3.50+ as LNG Exports Surge and Heatwaves Fuel Bullish Breakout

Hot Weather, LNG Demand, and Technical Breakouts Accelerate Natural Gas (NG=F) Price Action

Natural Gas Futures Reclaim $3.50 With Bullish Momentum and 200-Day MA Break

Natural gas futures surged to a one-week high at $3.414/MMBtu, registering a 4.59% intraday gain on July 14, 2025. The August contract on NG=F recaptured its 200-day moving average, with strong upside momentum lifting prices to a six-day high at $3.50. The rally was driven by hotter-than-expected weather forecasts across the Lower 48 states, strong LNG export demand, and technical strength building toward the $3.57–$3.75 resistance cluster. Notably, higher lows were established at $3.15 and $3.38, indicating a shift to bullish control over near-term price action.

Electric Grid Demand Surges as Heatwave Spreads Across U.S.

Meteorological updates from Atmospheric G2 forecast increased heat across the Southern and Eastern U.S. between July 19–28, adding pressure on utilities to ramp up air conditioning usage. This has already translated into higher gas-fired electricity output. The Edison Electric Institute reported total Lower-48 electricity generation at 93,747 GWh for the week ended July 5, marking a 1.0% y/y rise, with a 52-week output trend of +2.4% y/y. This directly correlates to stronger gas demand from power generators, feeding the recent bullish action in NG=F.

LNG Export Feedgas Rises to 16.6 Bcfd, Targeting Atlantic Basin

LNG feedgas deliveries spiked to a three-month high of 16.6 Bcfd, with the Venture Global Plaquemines facility in Louisiana alone accounting for 2.9 Bcfd, per LSEG data. This marked a sharp recovery from June’s lower output as liquefaction units exit maintenance. While April’s peak was 16 Bcfd, the current rebound shows restored export flow strength, primarily heading toward Europe and potentially to Asia if spreads widen. Feedgas flow trends now provide a tailwind to U.S. benchmark pricing.

Natural Gas Inventories Show Mixed Signals: 6% Above 5-Year Average

Despite the bullish price momentum, inventory builds continue. The latest EIA report showed +53 Bcf injection, under consensus estimates of +61 Bcf, but exactly at the five-year average. Inventories are 6.1% above the five-year norm and down 6.0% y/y, signaling adequate supply coverage but not oversaturation. LSEG data show production in July averaging 106.8 Bcfd, a new monthly record, up from 106.4 Bcfd in June. On July 14, Lower-48 dry gas output was 107.2 Bcfd, a 3.0% y/y increase.

Spain Emerges as a European LNG Redistribution Hub as Germany Lags

European gas storage data show a critical imbalance. While the EU average sits at 58% capacity, Germany lags at 52%, with its Rehden site collapsing to just 2.45%, down from 85% last year. Spain, in contrast, stands near 70%, supported by its six regasification terminals and Medgaz pipeline from Algeria. With France near 60% and Germany exposed, Spain becomes the logistical hub for LNG redistribution across Europe. If Asian demand rises or Algerian flows decline, Spanish capacity could price higher.

European Wind Generation Falls 40%, Boosting Gas Burn Rates

Europe’s power market is absorbing the heatwave impact, as wind generation collapses by 40% in July, forcing greater gas dependency. As a result, electricity prices in Germany have peaked near €550/MWh, compared to more moderate levels in Spain. The dual effect of weaker renewables and low gas reserves raises the stakes for Q3 gas flows, especially with S&P Global projecting a 50% YoY increase in European LNG demand for Q3.

Asian LNG Market Holds Steady as JKM-TTF Spread Narrows

The Japan-Korea Marker (JKM) holds near $13/MMBtu, while TTF pricing surged 5% last week, narrowing the transcontinental spread to under $1.00/MMBtu. This keeps most U.S. LNG cargoes in the Atlantic Basin for now, but a pricing surge in Asia would quickly redirect volumes, tightening domestic U.S. supply. Rystad Energy warns that if Asian premiums widen, exports could shift abruptly—pressuring U.S. storage levels and lifting NG=F.

Hurricane Risk Remains Muted But Watchlist Builds in Gulf

A tropical system off Florida holds a 30% chance of strengthening, according to the National Hurricane Center. Although only 2% of U.S. gas production comes from offshore Gulf rigs, the real risk lies in LNG terminal disruptions. Any forced outage—especially at Cheniere or Venture Global facilities—could impact feedgas flows, triggering immediate supply bottlenecks. Traders remain watchful of storm tracks into the Gulf of Mexico.

Technical Resistance Zones Cluster at $3.57 and $3.75

NG=F faces upside resistance at $3.57, the prior swing high, followed by $3.75, the lower high in the recent structure. Above these zones, momentum confirms a sustained bullish reversal. Support remains strong around the rising trendline at $3.15, where a 78.6% Fibonacci retracement was previously respected. Key moving averages cluster between $3.53 and $3.55, including the 20-day and 50-day MAs, adding layered resistance that must be cleared for NG to target $4.00.

Final Call: NG=F Holds Bullish Bias With Strong Fundamentals and Macro Catalysts

While natural gas storage remains high by historical norms, the current surge in LNG exports, extreme summer weather, recovering technicals, and global imbalance between Europe and Asia create a supportive backdrop. As long as NG=F holds above the $3.15–$3.38 support zone and continues to attract bullish flow near the 200-day MA, momentum favors additional upside. The next bullish confirmation comes on a daily close above $3.57. Risk remains tied to sudden shifts in weather, LNG maintenance outages, or unexpected storage gluts. But barring those, NG=F is structurally firm with potential upside toward $4.00 through Q3 2025.

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