Natural Gas Update August 29,2025

Overview

Natural Gas-- NG is up 3.4 cents
NG futures are higher this morning continuing the rally seen the past few sessions, but some skepticism for a further rally is noted given that the next few weeks will see a "bearish" weather outlook. Yet, the bullish EIA storage number seen Thursday suggests an overall  tightening of the gas supply/demand picture.

The EIA number showed a build of 18 BCF in Thursday's data. This was 6 to 10 BCF below forecasts. For a second straight week, the EIA number was the single smallest injection for the week in the last 5 years. The bullish number helped NG futures rally quite a bit. The bullish number was helped by weak renewables, as per NGI commentary. Total storage rose to 3.217 TCF. This leaves storage -112 BCF/-3.36% versus last year's level, but +154 BCF/+5.03% versus the 5 year average. A comment seen describes how the South Central region's data suggests a tightening of NG storage. The South Central region has seen salt storage facilities withdraw 29 BCF in the past 2 weeks EIA data, signaling regional supply constraints.  Dry gas output from the Haynesville and Permian basins has plateaued, the commentator adds. Those 2 basins lie within the South Central region. Also worth mentioning is that the South Central region is home to most of the LNG export plants.

Celsius Energy points out that feedgas demand for LNG export has been near 16 BCF/d of late. This is + 4.8 BCF/d versus the year ago level as last year saw a drop off at this time. Celsius adds that this 4.8 BCF/d higher demand is thus canceling out the production gain seen during the past year.

Mexico’s imports of U.S. pipeline natural gas have continued to reach new heights this month, averaging slightly under 8 BCF/d through Thursday (Aug. 28), according to NGI data. During the first quarter of 2025 the exports ran under 7 BCF/d. 

LSEG lowered their cooling degree day (CDD) forecast for the next 2 weeks on Thursday. They estimate a level of 128 CDD's over the next 2 weeks. On Wednesday they had forecasted 155 CDD's for the next 2 weeks. The nor for the 2 week period is 130 CDD's.

Global demand for natural gas will rise more than 20% by 2050 from last year's level, as it displaces coal to power industries and meet higher electricity use in developing countries, Exxon Mobil said on Aug. 28 in an annual outlook.

The Asian LNG spot market saw record-high trading activity during the Platts Market on Close assessment process. Market sources saying the surge reflected rising liquidity and growing commoditization of LNG trading.  Many market participants pointed to the standardization of LNG cargoes -- with more uniform sizes, quality and contract terms -- as a key driver of the increased activity, as it has greatly improved traders' ability to optimize positions and manage risks. Many market participants pointed to the standardization of LNG cargoes -- with more uniform sizes, quality and contract terms -- as a key driver of the increased activity, as it has greatly improved traders' ability to optimize positions and manage risks. (Platts)

Technically NG has positive momentum basis the DC chart as the spot futures prices are now up over 13% from the $2.622 low seen Monday when September was the spot futures. Above the double top from yesterday/today at 2.996/2.999, next resistance is seen at 3.074-3.078. Support below is seen at 2.878-2.882 via the October 60 minute chart.

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