The US Energy Information Administration predicts that natural gas spot prices at the US benchmark Henry Hub will average $5.67 per million British thermal units (MMBtu) between October and March, the highest winter price since 2007–2008, in its October Short-Term Energy Outlook. Even after relatively moderate growth in U.S. natural gas production, the increase in Henry Hub prices in recent months and in the outlook reflects below-average storage levels heading into the winter heating season and robust demand for U.S. liquefied natural gas (LNG).
Henry Hub prices are expected to fall after the first quarter of 2022, according to the EIA, as supply growth outpaces LNG export growth. LNG shipments from the United States have reached a new high this year, with a new peak expected next year. LNG exports are expected to average 9.7 billion cubic feet per day (Bcf/d) this year, up 3.2 billion cubic feet per day (Bcf/d) from the record high of 6.5 Bcf/d set in 2020, and to surpass annual pipeline natural gas shipments for the first time.
The increase in LNG exports year over year coincides with a small increase in natural gas output in the United States. This year, dry natural gas output in the United States is predicted to average 92.6 Bcf/d, up 1.1 Bcf/d from 2020 but down 0.3 Bcf/d from 2019.
LNG exports in the United States have expanded faster than domestic natural gas production, resulting in lower-than-average stockpiles. The EIA predicts that total US natural gas stockpiles were 5.5 percent below the five-year (2016–2020) average as of the end of September. According to the EIA, natural gas stocks in the United States will start the winter heating season on November 1 at 3,572 Bcf, which is 4.8 percent lower than the five-year average.