Natural Gas Update October 27,2025

Overview

Natural Gas --December NG is down 5.6 cents at $3.939
December NG is lower now after attempting to rally overnight. Strong production and a seasonally average weather outlook seem to be weighing on prices.

The Sunday evening strong opening in NG futures was likely helped significantly by the news of record LNG feed gas volume. LNG feedgas demand rose to a new record high of 17.3 BCF/d Saturday, up more than 4 BCF/d vs 2024. Celsius Energy added that "by Wednesday, below-average temperatures will cover the entire Gulf Coast. This makes liquefaction more efficient and, barring unscheduled maintenance, clears the way for feedgas to challenge 18 BCF/d." 

Meteorologists forecast temperatures across the country will remain mostly near-normal through November 8. (Reuters)

NatGasWeather said Friday that they see next week's EIA gas storage report as near or slightly above normal due to "strong wind generation" in the week ended Friday Oct. 24. Early estimates seen are calling for a build of 70 to 73.7 BCF. This compares to the 5 year average build of 69 BCF and last year's build of 79 BCF. The prospect heard is for the end of the month storage total to revert to a deficit versus last year. As of November 1 last year, storage stood at 3.931 TCF. Last week's storage data showed a total of 3.808 TCF in tank as of October 17.  

LSEG said average gas output in the Lower 48 states has fallen to 106.7 BCF/d so far in October, down from 107.4 BCF/d in September and a record monthly high of 108.0 BCF/d in August. This October natural gas production figure seen Friday was up 0.2 BCF/d from that seen 10 days prior. Last Thursday's gas production was seen at 109 BCF/d, as per Bloomberg data.

The Baker Hughes gas rig count was unchanged in Friday's report. The current rig count is up 20 rigs, 19.8% on the year.

The LN/NG November options expire tomorrow. Sizable open interest of at least 13,000 contracts ( and more) is seen in the whole strip of put options from $3.00 to $3.30. In the call options, the only nearby strike with any sizable open interest is the $3.25. The $3.50 strike --it is worth mentioning--has total open interest of over 63,000 contacts.

With only 3 sessions left until the November NG futures expire, we have shifted our technical outlook to December, which is now the most traded contract month. The high for the session was seen on the Sunday evening opening. Resistance for the December futures lies at the overnight high at 4.098-4.100 and then at 4.173-4.180. Support comes in at 3.867-3.869. There is a double bottom above that from Friday/ today at 3.910-3.911.

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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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