Natural Gas News: Is Trump’s Deregulatory Push Setting Up a Bullish Market?

How Will Trump’s Energy Agenda Redefine Opportunities in Natural Gas?

As President Donald Trump prepares to take office on January 20, 2025, his administration’s energy policies are poised to significantly impact the natural gas market. For investors, understanding these potential changes is crucial for strategic decision-making.

Will Deregulation Boost Natural Gas Output?

President-elect Trump’s agenda includes an aggressive rollback of environmental regulations to bolster fossil fuel production. Plans to dismantle regulatory bodies, such as the Environmental Protection Agency’s Office of Environmental Justice and External Civil Rights, aim to reduce operational constraints on energy producers.

This deregulatory push is expected to lower production costs and encourage increased natural gas output. However, the potential for legal challenges from environmental groups could delay or limit the full realization of these initiatives, creating uncertainty around future supply growth.

How Will Expanded LNG Exports Affect Supply and Prices?

The incoming administration intends to lift the moratorium on new liquefied natural gas (LNG) export permits, a move anticipated to double U.S. LNG export capacity over the next five years. While this expansion opens lucrative markets abroad, it may tighten domestic supply, exerting upward pressure on natural gas prices.

The U.S. Energy Information Administration (EIA) forecasts that natural gas demand, driven by exports, will outpace supply growth in 2025, leading to a drawdown in inventories and contributing to price increases. If producers are unable to ramp up output quickly due to permitting delays or infrastructure bottlenecks, supply constraints could further support higher prices.

Could Infrastructure Investments Reshape Market Trends?

Trump’s “energy dominance” strategy includes significant investments in energy infrastructure, such as pipelines and export facilities. These developments are expected to enhance distribution efficiency and market reach for U.S. natural gas.

For instance, the endorsement of the Alaska LNG pipeline project aims to transport natural gas from the North Slope to export terminals, potentially increasing supply to global markets. However, the completion of these projects hinges on complex permitting processes, regulatory reviews, and substantial capital investments, all of which could delay their impact on supply growth.

What Are the Price Projections for Natural Gas During Trump’s Term?

Market analysts have adjusted their price forecasts in light of the anticipated policy shifts. Morgan Stanley, for example, has raised its 2025 Henry Hub natural gas price forecast to $4.15 per million British thermal units (MMBtu), up from a previous estimate of $3.75/MMBtu.

This revision reflects expectations of increased demand from LNG exports and heightened heating needs due to colder weather patterns. The EIA projects the Henry Hub spot price to average $3.10/MMBtu in 2025, rising to nearly $4.00/MMBtu in 2026, influenced by tightening supply-demand balances.

Market Forecast: Set for a Bullish Run

Considering the planned deregulation, expansion of LNG exports, and infrastructure investments, the outlook for the natural gas market during President Trump’s term leans bullish.

While production is expected to increase, factors such as growing export demand and potential constraints on supply growth, including permitting challenges and infrastructure delays, are likely to support higher natural gas prices.

Investors should monitor policy developments and market responses closely to capitalize on emerging opportunities in this evolving sector.

More Information in our Economic Calendar.