Natural gas prices expected to rebound by 2025

Although natural gas prices are down 10% so far this year, they are expected to end the year in negative territory, mainly due to a mild winter and oversupply. However, industry experts are optimistic about a rebound in 2025, driven mainly by increased exports and increased demand for AI-driven facilities. Francisco Blanch, head of global commodities and derivatives research at Bank of America, underscored this positive outlook at a recent Energy Outlook Roundtable.

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A key driver of this optimism is the expected growth in data center power demand, which analysts say will grow at a rate of 10% to 15% annually through 2030. Natural gas will play a key role as a reliable energy source to support this demand, and is expected to account for 5% of total global electricity demand by 2030. BOK Financial’s Dennis Kissler supports this view, arguing that natural gas will be the “fuel” of the future.

Additionally, expected deregulation by the new Trump administration could improve industry profitability by removing regulatory hurdles affecting liquefied natural gas (LNG) export licenses and pipeline projects. IndexBox data shows that the share prices of well-known market players such as Williams Companies and Oneok have increased by more than 40% this year.

Looking ahead, U.S. LNG exports are expected to grow 15% next year, consistent with Europe’s efforts to diversify and increase its LNG infrastructure to minimize dependence on Russia. SP Global Commodity Insights expects Henry Hub natural gas prices to exceed $4.00 per million metric British thermal units (MMBtu) by 2025, mainly due to a surge in export demand.

However, some analysts, including Goldman Sachs, expressed caution. They forecast policy changes and potential delays in LNG supply developments could push expected price increases to 2026 rather than the second half of 2025.

Source: IndexBox Market Intelligence Platform