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SUPPLY & DEMAND FUNDAMENTALS

MONTHLY ENERGY OUTLOOK

November 2025

NATURAL GAS FUNDAMENTALS

US Storage

US natural gas storage levels as of the week ending October 24, 2025, stood at 3,882 Bcf, reflecting a net injection of 74 Bcf. This is 29 Bcf (1%) above levels from the same week last year and 171 Bcf (5%) above the five-year average (2020-2024). Injection rates this refill season are 1% higher than last year and 5% above the five-year average. With the injection season nearing its end, inventories are well-positioned above norms. Risks include early winter withdrawals from colder temperatures or export surges, while strong production could limit draws. Forward outlook suggests elevated storage mitigating price spikes into heating season unless demand exceeds expectations.

US Production

Latest EIA data shows US dry natural gas production reached 109.1 Bcf/d in August 2025, up 5.9% (6.0 Bcf/d) from August 2024, marking the highest monthly output since 1973. Output has trended higher year-to-date, supported by efficiency gains in core basins. Forecasts indicate modest growth into 2026, potentially averaging 108-110 Bcf/d, with shifts toward gas-focused plays like Appalachia and Haynesville amid favorable prices. Sensitivities include commodity price swings influencing rig counts, while risks encompass regulatory hurdles, pipeline constraints, and seasonal maintenance in Permian associated gas. Elevated production levels could offset rising exports but heighten oversupply risks if demand softens.

US LNG

US LNG exports achieved near-record levels in October 2025, with feedgas flows hitting 17.3 Bcf/d on October 25 and projected to reach 17.9 Bcf/d by month-end, surpassing prior highs. Shipments to Asia neared 3.61 million metric tons, the second-highest monthly total on record. 2025 FIDs have set records, with 55 mtpa sanctioned year-to-date, including six major projects reaching positive decisions. Capacity is on track to double by 2029, from 11.4 Bcf/d in early 2024 to 28.7 Bcf/d. Implications include sustained demand pull on domestic gas, tightening balances and bolstering prices, though global supply growth risks price suppression if economic slowdowns curb Asian imports.

Other Demand Drivers

2025 natural gas consumption forecasts indicate total demand averaging around 92 Bcf/d, with electric power at 36.5 Bcf/d (41% of US electricity generation), industrial at 23.8 Bcf/d, residential at 13.2 Bcf/d, and commercial at 9.9 Bcf/d. Power sector demand is projected to rise 2.5% in 2025, fueled by electrification and data center expansion. Structural changes feature rapid growth from AI-driven data centers (adding 10-80 GW by 2029) and manufacturing revival, countering slower residential gains. These trends exert upward pressure on seasonal peaks, with risks from variable renewable output increasing gas reliance for reliability.

Natural Gas Forward Strip(s)

NYMEX Henry Hub futures as of November 1, 2025, have climbed to a six-month high, with prices up 4% amid record LNG flows. Prompt month (December 2025) trades around $4.00/MMBtu, with winter strips elevated and the curve through 2027 showing contango. Trends reflect upward momentum, driven by export demand. Bearish factors include high storage and production; bullish elements encompass LNG records, data center loads, and winter risks. Takeaway: Secure winter positions for upside protection, but watch production ramps that may limit rallies.

POWER FUNDAMENTALS

Load | Demand Growth

Latest ISO forecasts project robust electricity demand: ERCOT at 11% annual growth in 2025-2026, PJM at 4%, and MISO with upward revisions to 142,793 MW summer capacity in 2025. PJM anticipates summer peaks reaching 229 GW by 2045, with national CAGR around 1.5-2%. ERCOT generation could jump 22% to 560 billion kWh by 2026. Drivers center on data centers (80 GW aggregate utility forecasts), AI, and industrial electrification, focused in these regions. This may challenge grid stability, with risks from permitting delays exacerbating supply shortfalls.

Forward Power Strip(s)

Forward power prices as of November 1, 2025, trend higher across hubs, reflecting load forecasts and fuel dynamics. PJM Western Hub December around $60/MWh; ERCOT North spot averages elevated in October; MISO Indiana Hub forwards up 2-3% monthly. Drivers include surging demand and gas prices. Weather outlook for November favors above-normal temperatures in western and central US, with warmer South/Southwest, wetter Northwest/Upper Midwest, and drier Southeast, potentially easing early heating loads but sustaining Southern cooling. Spot averages peaked in tight markets. Outlook: Bullish winter strips on growth; renewables may temper upside.

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