Rising US Natural Gas Prices Amid Summer Heat and Project Delays

According to a recent analyst note from Roth, US natural gas prices are on the rise across the entire futures curve as summer temperatures increase. This upward trend continues despite clear signs that new US Liquefied Natural Gas (LNG) export projects are facing delays.

Near-month Henry Hub natural gas prices have experienced a notable surge, climbing in 22 of the last 33 trading sessions and 8 of the last 10. Currently, prices are up just over 20% for the year.

However, 2024 natural gas prices, as indicated by the futures curve, have remained flat year-to-date, while 2025 futures have increased by about 6% this year. Analysts observe that the recent strength in near-month Henry Hub gas prices corresponds with the onset of warmer summer weather.

Interestingly, gas-focused US Exploration and Production (E&P) companies have not matched the positive price trends in natural gas futures over the past weeks. Analysts from Roth suggest that equity investors may be more concerned about the delays in LNG projects than traders or investors in the gas market.

Despite these concerns and a recent strong performance of these stocks leading to some profit-taking, most investors Roth has consulted still favor gas-focused US E&P companies as their preferred sector play. This indicates a medium to long-term confidence in rising prices driven by favorable demand and export dynamics, with gas-focused E&Ps viewed as an excellent opportunity to capitalize on this trend.