Henry Hub spot prices fell sharply in 2023 and have stabilized below $3/MMBtu in early 2025. Looking ahead, the EIA forecasts a gradual increase, with NYMEX futures near $3.50–$4.00/MMBtu through 2026. However, price volatility remains high—with a 95% confidence interval ranging from $2/MMBtu to over $12/MMBtu in late 2026—driven by uncertainty in demand, weather, and geopolitical risk.
Brent crude prices dropped to $66/bbl due to trade tensions and OPEC+ supply increases. We anticipate price pressure continuing as inventories build and production expands.
Brent is projected to average $68/bbl in 2025 and fall to $61/bbl in 2026 amid rising inventories and slowing demand growth. Geopolitical uncertainty may still cause price swings.
Slower-than-expected demand leads to revised output projections of 0.9 million b/d in 2025 and 1.0 million b/d in 2026. Uncertainty in global trade and investment incentives weighs heavily.
Consumption growth is expected to remain modest, increasing by 1.3 million b/d in 2025 and 1.1 million b/d in 2026—driven primarily by Asia-Pacific demand.
Summer 2025 gasoline is forecast to average $3.10/gal, down 20 cents from prior estimates, largely due to softer crude prices.
Hydropower is set to rise 7% in 2025 as drought conditions ease. Renewables remain a core growth driver in U.S. power generation.
