Natural Gas price forecast for 2025 as of Dec 23

[dan_s]

This morning (Dec 23) this is the NYMEX Strip for HH natural gas futures prices for 2025 and how they compare to my forecasts.
Strip > My Forecasts by quarter
Q1: $3.33 > $3.25
Q2: $3.05 > $3.00
Q3: $3.41 > $3.75 I believe we will see a Bidding War for NGas in mid-Q3 like we saw in August, 2022 when the price spiked to over $9.00
Q4: $3.83 > $4.00 because Golden Pass Trains 1 & 2 should be coming on-line in early Q4 and gas in storage will be lower than normal.

Where natural gas prices really go is up to the weather in the Eastern U.S.
> The current forecast for January & February is after a brief warm-up between Christmas and New Years Day, the MJO pattern shows a colder than normal January 1-20 with very cold January 5-15 for the Eastern U.S.
> After January 20th temperatures in the Eastern U.S. should be near normal and then (if the MJO goes where Joe Bastardi forecasts it to go) February should be colder than normal most of the month in the Eastern U.S.
Obviously, the weather forecast beyond the next few weeks can change.

Celsius Energy expects EIA to show NGas storage draws of
95 Bcf for week ending Dec 20
136 Bcf for week ending Dec 27
73 Bcf for week ending Jan 3 < brief warm-up forecast above
203 Bcf for week ending Jan 10 < If so, the NYMEX contracts for FEB25 and MAR25 could go over $3.50.

My Wild Ass Guess is that draws for the three weeks ending January 31 will total 625 Bcf, pushing storage near the 5-year average.

As of TODAY, it looks like NGas in storage will go below the 5-year average some time in February. If so, the chance of a Bidding War in Q3 between the utilities and LNG exporters increases.

Key drivers of the U.S. natural gas price:
> Weather in Q1
> LNG exports
> Demand from natural gas fired power plants during the summer.

[dan_s]

Note from HFI Research this afternoon.

Staying Bullish on Natural Gas Price

"Weather model updates over the weekend continue to favor a colder-than-normal outlook starting in the 10-15 day period. As we have been updating in the chat, you can see that the heating demand starts to move above the seasonal norm starting in day 12 (Jan 2)."

Agrees with Joe Bastardi's Saturday Summary: https://www.weatherbell.com/premium/

[dan_s]

From OilPrice.com

- US natural gas producers are anticipating a reversal of fortunes next year after 2024 saw gas-focused drillers struggle with oversupply and multi-year price lows, dipping as low as $1.60 per mmBtu during the year.

- Over the next 12 months, US natural gas production in the Lower 48 states is expected to add around 4 BCf/day and surpass 107 BCf/day by next December, buoyed by Henry Hub finally trending $3.7 per MMbtu.

- Gas drillers are now assessing the impact of winter weather on demand to convert uncompleted wells to wells in production, with next year’s anticipated LNG feedgas ramp-up boosted by the recent launch of Venture Global’s Plaquemines LNG facility.

- Total US feedgas demand is set to rise from 13.2 BCf/day in 2024 to more than 19 BCf/day in 2026, following the commissioning of ExxonMobil’s Golden Pass LNG plant, pushed to late 2025 after a string of postponements. < This is part of the reason that I am predicting a Bidding War for physical natural gas supply in Q3 2025 similar to what happened in August 2022.