In mid-June 2025, U.S. natural gas prices remained subdued despite forecasts of upcoming heatwaves, as supply outpaced weak demand and storage levels rose. Meanwhile, European gas prices surged amid soaring temperatures, maintenance-related supply cuts from Norway, and geopolitical tensions following Israeli attacks on Iran, raising fears of disruptions in Middle Eastern energy flows. Both regions now await clearer demand signals and geopolitical developments to determine future price trends.
Mid-June Natural Gas markets experienced a blend of weather-influenced demand and geopolitics unease influencing trends in the U.S. and Europe. As the U.S. coped with excess supply and waited for a possible demand uplift from impending heatwaves, Europe responded sharply to concerns about supply disruption and increasing temperatures that boosted energy consumption.
In the U.S., forecasts indicated a spell of above-average heat during late June, which was likely to drive air conditioning demand and subsequently elevate natural gas consumption for power generation. This provided natural gas markets with a temporary lift in sentiment. Real demand continued to be weak as of mid-June, though. Industrial usage and power generation were still below average, and electricity generation had also fallen relative to a year ago. Although LNG exports increased modestly, they didn't rise enough to change the overall equation.
In supply, natural gas production remained robust and remained ahead of consumption. Storage levels experienced a larger-than-anticipated week build, indicating that supply remained in charge. This prevented prices from making a firm upward advance. Natural gas futures floated just below a key technical level, and speculators closely observed to determine whether prices would break out higher or fall back down. Although the heat forecast provided some optimism, the true rally depended on more robust indications of demand or outside-market assistance.
At the same time, European natural gas prices surged as intensified geopolitics and warmer temperatures fueled concerns. Israeli attacks on Iranian nuclear and missile facilities triggered concerns of an expanded conflict in the Middle East, a region crucial for international energy shipments. While there was no initial disruption to LNG shipments through the Strait of Hormuz, there were concerns about delays or eventual blockage among traders. This volatility led to a surge in natural gas prices, as well as oil.
Europe also had its own weather issues. A period of record-above temperatures extended cooling demand to a two-year high. That was at a time when natural gas storage was still trying to catch up following a rough winter. Natural gas pipeline supplies were also restricted by maintenance activities in Norway, which further tightened the market. With Asia also heading into peak summer demand, global LNG supplies were going to be put under greater pressure.
Ahead, the US natural gas market was looking for firmer demand cues to balance its own oversupply, while Europe stayed watchful for any potential disruption in supply streams and weather-related factors. In both regions, the next moves in gas prices would depend heavily on how these factors played out in the coming weeks.
