Natural Gas Prices Stabilize at $3.00 as LNG Exports and EIA Outlook Signal $4.60 Peak

Natural Gas Price Holds $3.00 as Futures Signal Turning Point

Natural gas (NG=F) has reclaimed the $3.00/MMBtu mark, a critical psychological and technical level that underscores a market shifting toward strength. October contracts rebounded from $2.92 to $3.04, confirming support at the 20-day average of $2.93. Momentum now targets resistance at the 50-day average of $3.07, with a breakout opening the way to $3.20 and potentially $3.47, aligning with the 200-day average near $3.50. The price structure shows a market attempting to exit its weak season and prepare for winter-driven demand.

Technical Reversal Patterns Reinforce Bullish Momentum

A bullish engulfing weekly candle three weeks ago remains intact, pointing to a sustained reversal. That setup, followed by a pullback to the 20-day average, reflects a textbook continuation signal. The $0.58 or 22% rally from the August $2.62 low to the $3.20 peak was partially retraced, leaving the market compressed for another run higher. Current volatility highlights uncertainty, but buyers are increasingly asserting control, especially as futures hold above the $3.00 pivot.

EIA Projects Henry Hub Above $4.00 in 2026

The U.S. Energy Information Administration (EIA) sees Henry Hub spot prices averaging $3.52/MMBtu in 2025 and climbing to $4.28 in 2026, nearly doubling 2024’s $2.19 average. The forecast shows a January 2026 peak at $4.60 as storage is drawn faster than normal amid strong LNG exports. Inventories ended August 6% above the five-year average, limiting summer prices, but accelerating withdrawals this winter are expected to tighten balances and support higher levels.

Seasonal Roll Adds Fuel Ahead of Winter

The switch from October to November contracts amplifies upside pressure, with colder U.S. demand curves in play. Short-term weather remains a swing factor: September’s unexpected warmth in the Midwest added incremental demand, helping October contracts remain firm. As winter approaches, heating-driven consumption becomes the dominant driver, shifting sentiment decisively bullish.

LNG Benchmarks Confirm Export Tightness

Latin America DES LNG prices highlight global demand pull. October deliveries price between $10.41/MMBtu in Mexico East (Altamira) and $10.87 in Chile’s Quintero, climbing above $11.20 by December. Sustained double-digit levels ensure U.S. exports remain competitive. European storage sits above 80% capacity, but geopolitical risks and cold snaps could ignite another leg higher. Washington’s focus on LNG under its “energy dominance” initiative only reinforces the structural export case.

Regional Spot Prices Expose Pipeline Constraints

Basis spreads reveal stark imbalances. Henry Hub trades at $0.08, while El Paso Permian sits at $1.515 and Waha at $1.26, reflecting pipeline bottlenecks in West Texas. Meanwhile, Canadian benchmarks plunged into negative territory, with NOVA/AECO at -$0.42 and Westcoast Station 2 at -$0.655, highlighting oversupply where takeaway capacity is limited. These divergences emphasize the strength of LNG-linked hubs relative to constrained regional pricing.

Forward Curve Signals Upside Risk

BMI projects Henry Hub at $3.20 for 2025, while Standard Chartered sees $3.35, both more conservative than the EIA’s $3.52. With marketed U.S. output projected at 117.1 Bcf/d in 2025 and slipping to 116.8 Bcf/d in 2026, and with associated gas from oil drilling slowing, the balance tightens further. Appalachia and Haynesville growth may offset some declines, but production discipline keeps upward price risk alive.

Verdict: NG=F a Buy Into 2026 Rally

With futures consolidating around $3.00, technicals flashing bullish signals, and forecasts pointing toward $4.00+ by 2026, natural gas is undervalued at current levels. Winter demand, LNG exports, and moderated production set the stage for a structural rally. Near-term resistance lies at $3.50, while medium-term targets between $4.28 and $4.60 offer compelling upside. Based on the data, NG=F is a Buy with bullish momentum favoring long positioning into winter and beyond.

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