EIA: Nov STEO Cuts Winter NatGas Price By 36% From 2025-26


   
Daniel Rodriguez Huerta
DTN Refined Fuels Market Reporter

   CALGARY, CANADA (DTN) - U.S. natural gas prices for the 2026-27 winter are 
expected to be more than a third lower than the 2025-26 cycle mainly due to 
lower projected demand for heating from warmer-than-usual temperatures, 
according to the latest Short Term Energy Outlook (STEO) of the Energy 
Information Administration (EIA).

   The Henry Hub spot price for gas is expected to average $2.87 MMBtu for 
November through March, the EIA's November STEO released Tuesday (11/10) 
showed. That puts the spot price at 16% beneath the EIA's October STEO forecast 
and 36% below the prior winter's pricing.

   The EIA pegged its forecast to November's early weather, assuming 13% fewer 
heating degree days for the month versus the 10-year average. That, it 
reasoned, will lift gas in storage at end-November to 3.840 Tcf - some 67 Bcf 
more than previously estimated. 

   The EIA also expects higher production of the fuel to weigh on prices. Dry 
gas output is forecast to climb 4.07% to 117.61 Bcfd in 2027, versus a 2.24% 
rise in consumption to 94.42 Bcfd, the EIA said. Consequently, Henry Hub 
pricing is seen falling to an annual average of $2.88 MMBtu next year, from 
$3.37 MMBtu this year.

   Residential and commercial consumption is forecast to slip 3.8% from a year 
ago to reach 36.4 Bcfd this winter. Severe cold in January or February could 
still push demand above the projection and cause temporary price spikes, the 
EIA cautioned, although national weather agency NOAA expects above-average 
temperatures across the northern United States from December through February.

   International natural gas prices, however, remain at their highest since 
December 2022, supporting U.S. LNG export economics.

   Following the U.S.-Iran conflict, the Dutch Title Transfer Facility - the 
benchmark for near-month European has futures - hit an average of $28.51 MMBtu 
in October compared with the pre-conflict level of $11.27 MMBtu in February.

   New U.S. export capacity is projected to lift LNG cargoes to average 17.6 
Bcfd this year, from 15.1 Bcfd in 2025, and to 19 Bcf/d next year.




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