Permian Pipeline Constraints Trap US Natgas Prices in Negative Territory
US natural gas prices at the Waha Hub in Texas have closed in negative territory for a record 25th straight day. The Permian Shale, which spans West Texas and eastern New Mexico, is experiencing pipeline constraints that are trapping gas in the region.
According to analysts at consultancy EBW Analytics Group, continued negative pricing in the Permian is expected for much of the spring. As regional production likely ebbs lower, it may dent national-level headline output in coming weeks.
Gas production in the basin has climbed by around 12% a year on average over the past five years (2021-2025), making the Permian the fastest-growing and second-biggest gas-producing shale basin in the country. However, gas output growth in the Permian is expected to slow to around 4% a year on average in 2026 and 2027.
Longer-term, energy firms will likely boost Permian output when more gas pipes enter service, driven by soaring oil prices from the Iran war and increasing demand for gas to feed fast-growing US liquefied natural gas (LNG) exports and power-hungry data centers running artificial intelligence technologies.