Natural gas

Natural gas storage
The natural gas market is entering the final weeks of the storage injection season. We estimate the United States held 3,523 billion cubic feet (Bcf) of natural gas in inventory at the end of September. Inventories in our forecast build by 328 Bcf during October—slightly less than average—to reach 3,850 Bcf at the end of October 2026, which would put inventories 2% above the five-year average to start the heating season on November 1. Although the end of October is typically considered the close of the injection season, depending on market and weather conditions, inventories can often build through mid-November.

Above average inventories entering the withdrawal season provide additional supply to meet winter heating demand. Our forecast assumes heating degree days this winter will be nearly unchanged from last winter on a national average basis and 1% less than the previous five-winter average. Under these conditions, natural gas in storage provides a buffer against periods of increased consumption or reduced production. However, prolonged periods of cold weather could increase withdrawals beyond our forecast.

Natural gas prices
We forecast the Henry Hub spot price will average $3.16 per million British thermal units (MMBtu) in 2027, down 32 cents/MMBtu (9%) from 2026. The decline largely reflects high prices in January 2026 in the aftermath of winter storm Fern, when the Henry Hub price averaged $7.72/MMBtu as increased heating demand reduced natural gas supply. With inventory levels in our forecast for 2027 similar to inventories this year, we forecast the Henry Hub price will average $3.09/MMBtu from February through December in 2027, unchanged from the same period in 2026.

Ample natural gas inventories, relative to the previous five-year average, limit upward price pressures in our forecast. Inventories remain above the rolling five-year average in most months of our forecast, as ongoing growth in natural gas production supplies increases in liquefied natural gas exports and domestic demand growth. Monthly Henry Hub prices in the forecast for 2027 reach a low for the year at just $2.60/MMBtu in April and May and end the year at $3.90/MMBtu in December 2027.