The United States is on track for record natural gas production this year, the Energy Information Administration said in an Aug. 12 analysis.
In the first half of 2026, U.S. natural gas output averaged 121.3 billion cubic feet per day, up 4 percent from the same period last year, according to the latest Short-Term Energy Outlook.
Looking at the remainder of the year, marketed natural gas production is expected to average 122.5 billion cubic feet, topping the previous record of 118.5 billion cubic feet set in 2025.
The United States has been the world’s largest natural gas producer since 2009, a crowning achievement that is largely driven by two factors.
First, the shale revolution—horizontal drilling and hydraulic fracturing—unlocked massive amounts of domestic gas reserves.
Second, widespread pipeline infrastructure brought natural gas to market quickly.
Russia, Iran, and Qatar had been the undisputed top producers before America rose to become a global natural gas powerhouse.
The Permian Basin (Texas and New Mexico) and Haynesville (Louisiana and Texas) accounted for most of domestic production in the year’s first half.
Permian output is projected to climb 6 percent, while Haynesville production volumes are expected to increase 9 percent.
While both regions are major contributors to U.S. output, their drilling economics diverge sharply.
Permian operators target crude oil, with natural gas produced largely as a byproduct, whereas Haynesville producers drill almost exclusively for gas.
That distinction means Haynesville activity is far more sensitive to movements in the Henry Hub spot price.
Outlook for Natural Gas Prices
The federal agency predicts the Henry Hub spot price will fall by 2 percent, or 8 cents, to an average of $3.44 per million British thermal units in 2026.
“At this forecast price, drilling in the Haynesville remains economical despite the relatively deeper wells and more expensive development costs,” the report said.
“In addition, the Haynesville’s proximity to liquefied natural gas export terminals and major industrial natural gas consumers along the U.S. Gulf Coast draws operators to actively drill in the region.”
Natural gas prices have struggled this year, falling about 11 percent to around $2.80 per million British thermal units on the New York Mercantile Exchange.
A broad array of factors has driven prices lower in 2026.
Robust domestic production and an oversupplied market have far outpaced demand.
U.S. storage levels are also elevated, with inventories hovering at about 3.1 trillion cubic feet—almost 7 percent above the five-year average.
But liquefied natural gas exports have been strong this year, rising 15 percent year-over-year in May to record levels.
The Energy Information Administration estimates shipments could average 17.4 billion cubic feet per day in 2026 and top 18 billion cubic feet per day next year.
Prices could enjoy a near-term bounce on intensifying heat patterns forming across the United States heading into late August, says Phil Flynn, senior market analyst at The PRICE Futures Group.
“A prolonged ridge is building across the South-Central and Southeast, bringing hazardous heat with highs in the lower 100s in parts of the southern Plains and Lower Mississippi Valley, widespread 90s farther east, elevated heat indices, and little overnight relief,” Flynn said in an Aug. 12 note.
“Cooling demand should firm up power-sector burn and help put a floor under prices after the recent slide.”
The Short-Term Energy Outlook trimmed its forecast for natural gas prices, projecting an average of $3.44 per million British thermal units this year and $3.31 per MMBtu in 2027.
“The price decline is driven by reduced LNG feedgas demand and robust natural gas production,” the federal government said.
“Our forecast assumes prices will remain below $3.00/MMBtu in the coming months, driven by near record-high storage levels heading into October.”
