Natural gas extends decline as storage outlook keeps pressure on prices
Natural gas is trading around $2.88/MMBtu on September 10 and continues to decline after failed attempts to hold above $3.00. On the hourly chart, the price has already fallen below all major moving averages, while the local structure has shifted from bullish to bearish.
Pressure increased after the September EIA STEO: the agency expects U.S. inventories to reach around 3.969 Tcf by October 31, which is 5% above the five-year average. This is slightly below the August estimate of 3.985 Tcf, but it still confirms a substantial buffer ahead of the heating season. The main reason remains strong production and rising supply from the Permian and Haynesville.
Storage report becomes next test for Henry Hub
At the same time, the market is waiting for the new weekly EIA storage report today, due at 10:30 ET. The latest official release showed a high overall level of inventories, so the key question for prices now is whether the pace of injections is accelerating.
If the new build comes in above the seasonal norm, pressure on Henry Hub could intensify further; a weaker storage increase, on the other hand, would give the market a chance for a technical rebound. An additional demand factor remains constructive: U.S. LNG exports increased by 23% y/y to 17.4 Bcf/d in the first half of 2026, while the EIA expects around 17.3 Bcf/d in the second half of the year and 18.7 Bcf/d in the first half of 2027.
LNG demand offsets part of domestic weakness
The situation in the Middle East continues to support global gas prices, but for Henry Hub the effect remains indirect. In its September outlook, the EIA maintains a scenario of a gradual recovery in flows through the Strait of Hormuz, although some restrictions on exports from the region may, according to the agency, remain in place through the end of the year.
This means that European and Asian LNG markets may remain tight, supporting strong demand for U.S. cargoes, but within the U.S., strong production and high inventory levels continue to outweigh the external factor. That is why the geopolitical premium has failed to keep Natural gas above $3.00.
$2.85 marks key downside threshold
On the hourly chart, the nearest support is now around $2.86–2.85, while a break below it would open the way toward $2.82–2.80 and then $2.75. On the upside, the first resistance zone is around $2.90–2.92, while a stronger barrier is located near $2.96–2.98. To restore the bullish structure, the price will need to move back above at least $3.00.
For now, the short-term scenario remains bearish: high inventory levels and strong production are creating domestic pressure, while LNG exports and Middle East risks are more likely to limit the depth of the decline than reverse the market higher. Further NATGAS dynamics, as noted in Natural gas slips below $3.00 as storage and weather pressure build, may depend on today’s EIA storage report.
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