Natural Gas & Power Prices: Comfortable Today, But Pressures Are Building for later 2026–2027

Energy buyers are facing a confusing market. On one hand, U.S. natural gas storage looks healthy overall. EIA reported working gas in storage at 2,063 Bcf as of April 17, 2026, which was 142 Bcf above last year and 137 Bcf above the five-year average. EIA also expects storage to end October near 4,015 Bcf, about 6% above the five-year average. That is the “calming” part of the story.

But the market is not just about today’s storage number. RD Energy believes the bigger issue is whether supply can keep up with rising demand in 2026 and especially 2027.  We also believe in the face of today’s new domestic and global supply and demand dynamics, the EIA’s end of season storage numbers may be too optimistic, their LNG export volume expectations too low and their U.S. natural gas production volumes less predictable.

We are very confident in two things:

1. Buying at the right time in the energy market will be critical and
2. Reacting quickly to the buying opportunity will be even more critical.

The Key Price Drivers We’re Watching

1. LNG exports are becoming a bigger pull on U.S. natural gas.
   EIA forecasts U.S. LNG exports to average 17.0 Bcf/day in 2026 and rise again to18.6 Bcf/day in 2027. That means more U.S. natural gas will be connected to global prices, global weather, and global disruptions. In fact, U.S. LNG exports has already reached 20.4 Bcf/day in April and has averaged nearly 19 bcf/day for the entire month. Late 2026 and 2027 could see LNG export capacity to grow by another 2-4 Bcf/day.
2. The war and Qatar damage could matter.
   Recent reports indicate U.S. LNG exporters have helped fill a supply gap after damage to Qatar LNG facilities, with U.S. LNG exports up sharply year-over-year. If Middle East tensions continue, the Strait of Hormuz remains threatened, or Qatar’s LNG capacity stays impaired, global LNG buyers may lean even harder on U.S. supply. That does not automatically cause U.S. prices to spike, but it raises the risk that domestic prices stay firmer than they would in a normal global market.
3. El Niño may play a role, but it cuts both ways.
   NOAA says ENSO-neutral conditions are favored through spring, but El Niño is likely to emerge by May–July 2026 and persist through at least the end of 2026. El Niño can soften parts of North American summer or winter demand, but it can also create global energy stress through heat, drought, hydro shortages, and LNG demand overseas. For RD Energy clients, the message is simple: El Niño may not be a straight bullish or bearish factor, but it increases weather uncertainty. Normally an El Nino winter means warmer temperatures, storage surpluses and lower prices.  However, global demand especially in Europe will play a role in offsetting some of the bearish supply and demand fundamentals.  We’ve also seen the U.S. natural gas producers ability multiple times, including in April, to slow production to prevent price collapse.
4. Air-conditioning season still matters.
   Electric demand peaks during summer cooling months. EIA expects summer residential and commercial power demand to grow in 2026, with even stronger commercial growth in 2027. Hot summer weather can quickly increase natural gas burn for power generation, especially in regions like PJM.
5. Power prices are being pushed by demand growth, data centers, and PJM capacity.
   U.S. electricity demand is growing again after years of being mostly flat, with data centers becoming a major driver. In PJM, capacity prices cleared at $329.17/MW-day for 2026/2027, up from $269.92/MW-day for 2025/2026 in most RTO zones. That is a major budget issue even before considering energy supply prices.  Don’t expect relief next year either as the 2027/2028PJM year will see slightly higher PJM capacity prices than 2026/2027.

The Bottom Line

The natural gas market looks comfortable today, but 2026 and 2027 carry real upside risk. Storage is healthy, but LNG exports are rising. Production is expected to grow, but demand from power generation, data centers, LNG, and global disruptions could grow faster. EIA expects marketed natural gas production to increase in both 2026 and 2027, but its own forecast depends heavily on production growth, summer power burn, and LNG export ramp-up.  Multiple drivers of energy prices are changing rapidly so expectations and predictions need to be flexible.

For businesses, schools, manufacturers, municipalities, and Main Street customers, this is not a market to ignore.  Having the right energy partner has never been more important.

RD Energy’s Recommendation

Do not assume today’s calm in natural gas and power prices will stay that way.  There’s so many moving parts we have to wonder what will be the trigger to create a whole new level of price volatility.  This is the time to review electric and natural gas contracts, compare current market options, understand PJM capacity exposure, and consider tools like Peak Load Management and Demand Response.  We are reviewing all RD Energy client electric and natural gas contracts and will reach out to those who we feel may need to be looking at their price options sooner than later.

Not a RD Energy client yet?  RD Energy offers a free, no-obligation second opinion. Whether your contract ends soon or years from now, now is the time to ask:

“Are we buying energy the right way for the market we are heading into — not just the market we are in today?”