Natural Gas Update August 20,2025

Overview

Natural Gas --NG is down 1.8 cents
NG futures are slightly lower with the narrative being one of weak weather forecasts heading to the end of summer. LNG feedgas volume dipping the past few days also weighed on prices,  although volume has improved today. Overall strong gas production remains a recurring theme.

Forecasts issued Tuesday shifted cooler across the eastern two-thirds of the US for Aug 24-29, according to Bloomberg. Celsius Energy says that their analysis for GWDD's for the period from today into September is "easily" at a 5 year low for the period. 
 
US LNG feedgas is today estimated to recover up 1.03 BCF/d to 14.82 BCF/d with Freeport supply estimated back near normal after dropping to just 0.62 BCF/d yesterday, Bloomberg shows. Normal volume for the Freeport LNG plant is 1.9/2.0 BCF/d. Today's higher volume comes after two of the United States' largest LNG export plants recorded major declines in demand for natural gas on Monday Aug. 18, as per LSEG data. On Monday, Cheniere's Sabine Pass volume was down by 0.8 BCF/d, while Sempra's Cameron LNG plant in Louisiana, which processes 2 BCF/d, was down to 1.3 BCF/d.

On Tuesday,  Bloomberg data estimated lower 48 dry gas production at 108.45 BCF/d, down from the previous day of 109.75 BCF/d and down from the prior 7 days' average of 109.65 BCF/d. On Tuesday, LSEG said average gas output in the Lower 48 states has risen to 108.5 BCF/d so far in August, up from a record monthly high of 107.8 BCF/d in July. On August 8th, LSEG had August's average output at 108.2 BCF/d.

LSEG projected average gas demand in the Lower 48 states, including exports, would ease from 110.0 BCF/d this week to 105.7 BCF/d next week. These forecasts are down 4.8 BCF/d from those seen Friday. Next week's demand dropped by 3.9 BCF/d from that seen Friday.

Comments heard yesterday included : " Forward weather is simply awful for (power) load."  That comment by a colleague was echoed in WSJ commentary: "weather forecasts pointing to a mild tail end of summer. " "Near record production and cooling temperatures limit near-term upside, although the expected increase in LNG exports could be supportive longer-term and lower oil prices could curb associated gas production", as per one analyst, who added that weak European LNG prices might be "providing some background bearish influence." "Narrative Remains Bearish, But Prices Still Approaching A Bottom.", as per another analyst.

Technically, the NG spot futures have a mean reversion setup from the settlement below the DC chart's lower bollinger band Tuesday. That band lies at 2.737 currently. Also slightly supportive at present is the double bottom on the DC chart from yesterday/today at 2.725. But, momentum has turned negative with the selloff seen the past 2 sessions. Tuesday saw NG spot futures fall to their lowest value since Nov. 15,2024. Support is seen at 2.688 and then at 2.632-2.635 from data from the DC chart from last October/November. Resistance comes in at the former key support area at 2.851-2.858.

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This article and its contents are provided for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any commodity, futures contract, option contract, or other transaction. Although any statements of fact have been obtained from and are based on sources that the Firm believes to be reliable, we do not guarantee their accuracy, and any such information may be incomplete or condensed.

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