Natural Gas News: Bearish Forecast for Next Week as Mild Weather Caps Demand

Natural Gas Falls as Mild Weather and Strong Supply Undermine Bullish Momentum

U.S. natural gas futures ended the week lower, unable to sustain brief gains despite a smaller-than-expected inventory build. Market sentiment remains under pressure as spring weather suppresses demand, LNG exports slip, and production holds firm.

Last week, U.S. Natural Gas Futures settled at $3.245, down $0.282 or -8.00%.

Tecchnically, the weekly trend is up with the market trading on the strong side of the 52-week moving average at $2.910. However, short-term momentum is down.

Trader reaction to the pivot at $3.361 is likely to determine the direction of the market this week. If the downside momenum persists then look for traders to push natural gas into the support area formed by the former bottom at $2.957 and the 52-week moving average.

Look for buyers on the first test of the $2.957 to $2.910 support zone. But keep in mind there is plenty of room to the downside if it fails to hold.

Is Mild Spring Weather Eroding Demand?

Warmer-than-normal conditions across much of the U.S. are keeping both heating and cooling needs subdued. Forecasts show continued warmth across key demand centers through late April, particularly in the East, South, and Midwest. This seasonal lull is limiting residential and commercial consumption, with only short-lived cold snaps offering limited upside. Without a meaningful rise in weather-driven demand, traders are anticipating stronger storage injections ahead.

Bullish Storage Miss Fails to Shift Sentiment

The EIA reported a 16 Bcf injection for the week ending April 11 — well below the expected 24 Bcf and the five-year average of 50 Bcf. While inventories remain tight at 20.9% below last year and 3.9% below the five-year average, the smaller build failed to spark a rally. The market remains focused on forward-looking fundamentals, where increasingly mild temperatures suggest storage builds could accelerate in the coming weeks.

Supply Still Outpacing Demand Growth

Production remains elevated, with dry gas output in the Lower 48 holding above 105 Bcf/day — up more than 5% from last year. LNG export volumes have declined to 15.5 Bcf/day, softening the export demand side of the equation. While domestic consumption has increased 2.2% year-over-year, the supply-demand imbalance continues to favor the downside. Electricity generation offers limited support, with a 6.4% year-over-year increase in output, but not enough to reverse the broader surplus.

LNG Policy and Global Demand Remain a Wild Card

Long-term demand could benefit from recent moves to resume approvals for U.S. LNG export projects, but in the near term, global conditions remain uncertain. European storage remains behind seasonal norms, and Asian weather has not yet driven a surge in import demand. Until international flows strengthen, the export channel is unlikely to offer material support.

Market Forecast: Bearish Fundamentals Set the Tone

Despite a tighter storage backdrop, the near-term outlook remains bearish. Mild weather, steady production, and soft LNG flows are keeping pressure on prices. Without a shift in weather patterns or a rebound in exports, natural gas futures are expected to remain under pressure next week.

More Information in our Economic Calendar.