Natural Gas Prices Surge as Freeport LNG Resumes Operations

2025-03-29 economy

Texas, Friday, 28 March 2025.
Natural gas futures rise to $3.9/MMBtu following Freeport LNG’s Texas plant restart, emphasizing export capabilities’ impact on market dynamics.

Market Dynamics and Price Movements

U.S. natural gas futures have demonstrated significant momentum in early 2025, with prices increasing by 0.44 USD/MMBtu, representing a 12.17% rise since the beginning of the year [1]. The current trading level around $3.9/MMBtu reflects the market’s response to record production levels, with March output averaging 106.0 billion cubic feet per day (bcfd), surpassing February’s record of 105.1 bcfd [1].

Storage Trends and Weather Impact

Recent storage data reveals a notable shift in market fundamentals, as U.S. utilities added 37 billion cubic feet of gas during the week ending March 21, 2025, exceeding analyst expectations of 25 billion cubic feet [2]. This development has positioned storage levels 24.2% below last year’s levels and 6.5% under the five-year average [2]. Weather forecasts through April 9 indicate above-normal temperatures across the lower 48 states, potentially moderating heating demand and facilitating further storage builds [1].

Export Infrastructure Expansion

The U.S. LNG sector is experiencing significant expansion, with major projects advancing along the Gulf Coast. The $18.4 billion Rio Grande LNG Export Terminal in Brownsville has received crucial court approval [4], while the $10 billion Golden Pass export project in Sabine Pass, Texas, continues development [6]. These developments are particularly significant as the United States maintained its position as the world’s leading LNG exporter in 2024, with export volumes reaching 11.9 billion cubic feet per day [5].

Future Market Outlook

Market analysts project natural gas prices to reach $4.08 USD/MMBtu in the next 12 months [1]. The expansion of export capabilities, particularly with new capacity at Venture Global’s Plaquemines LNG plant in Louisiana contributing to increased LNG flows of 15.7 bcfd [1], suggests continued strong export potential. This infrastructure growth positions the United States to maintain its competitive edge in global LNG markets [5].

Sources

natural gas energy prices