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- Natural Gas Update August 21,2025
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August 21, 2025
Overview
Natural Gas-- NG is up 4.4 cents
NG futures are higher as demand has risen some and production has fallen slightly. LNG feedgas volume bouncing back recently is seen as supportive.
Bloomberg data estimated Wednesday's lower 48 dry gas production at 107.49 BCF/d, down from the previous day of 108.92 BCF/d. On August 10, Bloomberg had gas production at 110.03 BCF/d. Celsius Energy said that recent production declines have come mostly from the South Central region, which includes the Permian shale basin, where the rig count has fallen in recent weeks.
LSEG projected average gas demand in the Lower 48 states, including exports, would ease from 111 BCF/d this week to 106.6 BCF/d next week. These forecasts were up a total of 1.9 BCF/d from those seen the day before.
On a daily basis, LNG export feedgas was on track to rise to 15.3 BCF/d on Wednesday from a two-week low of 14.2 BCF/d on both Monday and Tuesday due to reductions at several plants. (Reuters)
The EIA gas storage number due out today is calling for a build of 22 to 25 BCF as per Reuters and WSJ surveys. This compares to last year's build of 29 BCF and the 5 year average build of 35 BCF.
Celsius Energy reports that wind generation has been weak recently. Wind generation came in at an anemic 514 GWh on Tuesday, a 2025 low, Celsius said. This allowed the natural gas power burn to claim a strong 47% share of the power stack, topping 48 BCF/d, up nearly 3 BCF/d vs 2025. Celsius added that even as wind generation was slightly stronger Wednesday, it remained well below year-ago levels.
NG futures open interest on the CME has increased by near 30,500 contracts in the past 2 sessions, even as the soon to expire September contract has seen open interest fall by nearly 26,000 contracts. The increases the past 2 sessions have come primarily in the October, November, December, February and March contracts. Given price action and the tone of the market, we lean to this mostly being new short positions.
"Goldman Lowers US Natgas Price Outlook" read the headline Wednesday. Goldman Sachs cut its September-October price forecast from $3.90/MMbtu to $3.35/MMBtu and its November-December price from $4.50/MMbtu to $4/MMBtu due to a revision in production numbers for the remainder of the summer. Production numbers beat predictions this month, suggesting drillers had accumulated larger-than-expected inventory over the course of 2024, which saw low prices and are now bringing those volumes to the marketplace, Goldman said. U.S. LNG has only offset higher output to a certain extent even as Plaquemines ramps up sendoff faster than anticipated. Goldman, though, maintained its view that production will need to be high in 2026, as it keeps its 2026 price at $4.60, suggesting an anticipated drop in production for next year. The bank maintains its recommendation to be long April 26 NG. (Market News)
TTF European gas prices are higher today due to the uncertainty over a deal to end the Ukraine war. EU storage levels are above 74%, compared to almost 90% at the same time last year. Technically, the spot TTF futures show a stepladder up pattern after hitting a multi month low on Monday. Momentum has turned positive with the move off of the Monday low.
Technically the NG futures have negative momentum basis the DC chart, but there are 2 elements we see from the past 2 days that are supportive. Wednesday saw the spot futures confirm the mean reversion setup by settling back over the lower bollinger band on the DC chart. Additionally, there is a double bottom from Tuesday/Wednesday at 2.725. Reuters commentary cited the Wednesday close, which was the lowest since November 8 of last year, as keeping the front-month futures contract in technically oversold territory for a second day in a row. Support for the spot NG futures lies at the 2.725 double bottom and then at 2.688 from data from October/November 2024. Resistance comes in from recent highs on the DC chart at 2.851-2.852 and then at 2.912-2.922.
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Disclaimer
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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