The U.S. Energy Information Administration expects natural gas inventories will increase to 3,985 billion cubic feet (Bcf) in October, the most gas in inventories ahead of the winter heating season since 2016.
Increased natural gas production and reduced feedgas stemming from liquefied natural gas (LNG) facility maintenance drove EIA’s forecast for higher gas in inventories in its August Short-Term Energy Outlook (STEO).
"More natural gas in inventories in the fall season provides a cushion for increased heating-related consumption during the winter," EIA Administrator Tristan Abbey said.
Key takeaways from the August STEO are below:
EIA energy outlook Aug 2026
- Global oil market assumptions. EIA has increased its estimates of shut-in crude oil production in the Middle East in the coming months compared with the July forecast as a result of continued constraints on transit through the Strait of Hormuz. The forecast assumes those constraints persist through August.
- Global oil prices. EIA expects global oil inventories to decrease, leading to higher Brent crude oil prices forecast to average $85 per barrel (b) in the third quarter of 2026 (3Q26). As inventories rebuild and production increases by early 2027, prices are expected to gradually drop to an average of $69/b in 2027.
- LNG exports. EIA forecasts U.S. LNG exports will average 16.5 Bcf per day in 3Q26, a slight decrease from July’s STEO because of maintenance at Freeport LNG. The result is lower feedgas demand and increased storage in the South Central region. Mexico’s new Energia Costa Azul terminal and higher U.S. gas consumption for power generation are increasing pipeline exports. EIA expects growth in U.S. LNG exports through 2027.
- Natural gas prices. EIA forecasts the Henry Hub spot price will average $2.87 per million British thermal units in 3Q26, 50 cents less than forecast last month. The decrease is driven by reduced LNG feedgas demand and robust natural gas production.
- Electricity demand. Texas Governor Greg Abbott paused new Texas data center projects on August 3. EIA forecasts a 6% electricity load growth rate for Texas in 2027 compared with 14% growth in the July STEO.
- Electricity generation. In 2026, renewable generation rose 11% in early 2026, driven by new solar projects and increased use of natural gas. EIA expects additional renewable energy capacity additions through 2027. Natural gas-fired generation is forecast to increase as prices remain low, while coal generation declines.
- Coal exports. U.S. coal exports surged in April and May, raising EIA’s 2026 coal export forecast to 102 million short tons. Metallurgical coal exports climbed throughout 1H26 aided by new and reopened mines. Steam coal exports rose in 2Q26 as natural gas-to-coal switching in Europe and Asia favored U.S. coal exports.
The full August 2026 Short-Term Energy Outlook is available on the EIA website.
