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EIA: Henry Hub Natural Gas Spot Price to Average Higher in 2024, 2025 Than in 2023

The Energy Information Administration expects the U.S. benchmark Henry Hub natural gas spot price to average higher in 2024 and 2025 than in 2023, but to remain lower than $3.00 per million British thermal units.

“We forecast increases in natural gas prices as demand for natural gas grows faster than supply in 2024,” EIA said on Feb.12.

In 2022 and 2023, increases in natural gas supply (domestic natural gas production and imports) exceeded the increases in natural gas demand (domestic consumption and exports), EIA said.

“In 2024, we expect the reverse will be true: demand increases by 2.3 billion cubic feet per day (Bcf/d) in our forecast, and supply remains relatively flat. In 2025, we expect supply and demand to grow at similar rates, although inventories will build because supply will still slightly exceed demand in our forecast,” the federal agency said.

At the end of January 2024, 7% more natural gas was held in U.S. inventories than the five-year (2019–23) average for that time of year. “We expect natural gas inventories to remain high relative to their previous five-year average throughout 2024 and 2025.”

EIA forecasts that most of its increase in U.S. natural gas supply will come from domestic production of associated natural gas, much of which is in the Permian region of western Texas and eastern New Mexico.

As a result, if U.S. crude oil production is less than EIA expects, “we will also see less natural gas production than we forecast.”

In late 2023, EIA detailed how different crude oil prices might affect crude oil and natural gas production in our short-term forecast, it pointed out.

EIA expects natural gas consumption to grow in all sectors in 2024 except the industrial sector, where it expects consumption will decrease slightly.

It also expects about 11% more U.S. natural gas consumption for electricity in 2024 than the previous five-year average.

EIA expects combined consumption in the residential and commercial sectors to be 5% higher in 2024 than in 2023 because January 2023 and December 2023 had warmer-than-average temperatures, leading to relatively low consumption of natural gas for space heating. “Our assumptions for future weather largely reflect the trend of the past 30 years.”

The mix of energy sources and technologies used to generate electricity affects natural gas consumption in the electric power sector, the agency noted.

“As developers add more generating capacity from solar- and wind-powered generators, those generators’ incremental generation may reduce the need to dispatch natural gas-fired power plants. Changes in the timing and magnitude of new solar and wind capacity would also affect our forecast for natural gas consumption in the electric power sector.”


The U.S. exported 20.8 Bcf/d of natural gas in 2023, 57% as liquefied natural gas (LNG). At the end of 2023, 11.4 Bcf/d of baseload nameplate LNG export capacity had been built in the United States, and “we expect developers to add an additional 5.3 Bcf/d of new LNG export capacity by the end of 2025,” EIA said.

“According to trade press reports and other sources, three new terminals will come on line in the second half of 2024 and in 2025. Any changes to the operational dates of the three new export terminals—Golden Pass and Corpus Christi Stage III in Texas and Plaquemines LNG in Louisiana—may notably affect our LNG export forecast and, in turn, our overall natural gas demand expectations.”

EIA said its forecast accounts for the recent U.S. Department of Energy (DOE) announcement to pause determinations on applications to export LNG to countries with which the United States does not have a free trade agreement. “However, capacity additions through 2025 will not be affected because these projects have been fully authorized by DOE and are already under construction.”

Natural gas prices at several price hubs in Europe and Asia remain relatively high over the forecast period compared with U.S. natural gas prices, EIA said.

EIA is assuming that U.S. LNG over the forecast period will continue to replace natural gas that had been exported from Russia by pipeline to Europe.

Because global LNG liquefaction capacity additions will be limited in the next two years, demand for flexible LNG supplies, mainly from the United States, will increase to meet incremental growth in global demand, it said.

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