U.S. natural gas prices surged to a three-year high on Monday in response to a significant winter storm that affected two-thirds of the continental U.S., leaving hundreds of thousands without power and increasing demand for heating. The Energy Information Administration projects that U.S. gas demand will grow by 5.8% over the next two years, outpacing supply growth of just 3.6%, further driving prices upward.
Natural gas is increasingly powered by new demand sources, including Liquefied Natural Gas (LNG) exports, which now account for over 14% of total U.S. production. Additionally, AI data centers are expected to derive 60% of their incremental electricity demand from natural gas, further supporting market growth. Companies in the Delaware Basin are uniquely positioned to capitalize on this rising demand due to their proximity to low-cost natural gas and existing infrastructure.
