Natural Gas Prices Stuck in Limbo Amid Supply Gluts and Geopolitical Risks
Natural gas futures are consolidating near their range lows as supply gluts meet geopolitical risks. The market remains caught between a well-supplied domestic backdrop and a tightening global picture.
US dry gas production has climbed to an average of 111.5 billion cubic feet per day in August, up from a monthly record of 110.7 bcfd in July. Meanwhile, weekly storage injections have been running below normal, with the most recent EIA report showing an addition of just 16 billion cubic feet.
Internationally, the picture is far more supportive. LNG vessel traffic through the Strait of Hormuz has collapsed by roughly 95% since US and Israeli military operations against Iran resumed in late February 2026, removing close to one fifth of global LNG supply.
The EIA's August Short Term Energy Outlook lowered its 2026 Henry Hub price forecast to $3.44 per MMBtu, down from $3.67 in July and more than 20% below the February 2026 estimate of $4.31.