Natural Gas Price Outlook

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Significant Developments from EBW AnalyticsGroup 6-6-2025 morning report

Yesterday’s EIA-reported 122-Bcf injection was the sixth-largest weekly build of the shale era, carrying the storage surplus vs. five-year
average to 117 Bcf. While the market shook off the 1.1-1.5 Bcf/d misfire as largely attributable to the Memorial Day holiday, the past six EIA
injections are averaging 111 Bcf/week. The storage surplus may reach 150 Bcf within the next two EIA reports and could exceed 200 Bcf in
the first half of July.
> Still, resilient bullish momentum at the front and constructive, identifiable fundamental catalysts—booming power burns, return of Cameron LNG, return of Sabine Pass, startup of new units at Corpus Christi, Plaquemines, and LNG Canada—continue to suggest upside potential over the next 30-45 days.
> As storage inventories bulge and less-extreme June weather forecasts imply a narrowing peak summer cooling season, however, risks for an eventual retreat in fall contracts may be rising.

The Texas Legislature finished its 2025 session without advancing anti-renewable measures that would have required renewable capacity
to pair with natural gas generation to “firm” output or add additional renewable permitting requirements. Interestingly, even the Texas Oil
and Gas Association publicly decried the bill with members attempting to electrify upstream operations. If approved, the measures could
have added to ERCOT electricity supply woes amid an onrush of soaring peak load—dramatically increasing the call on gas-fired
generation. In our view, while defeated this year, similar proposals are likely to emerge in future Texas legislative sessions—suggesting
regulatory risks may pose long-term upside ERCOT price risks and potential upside for natural gas power burns into the end of the decade.