Natural gas prices will rise this summer as power sector demand increases and production growth slows, according to updated projections from the Energy Information Administration (EIA).

After averaging $2.15/MMBtu in May, Henry Hub spot prices will climb to an average of slightly above $2.60 for 3Q2023, EIA said in its latest Short-Term Energy Outlook (STEO), published Tuesday.

Rising demand for natural gas in electricity generation and flattening production growth will see storage injections lag the five-year average pace in the coming months, according to the STEO.

“The Henry Hub spot price averages around $3.40/MMBtu in 2024 in our forecast, nearly 30% higher than in 2023,” researchers said.

This would be welcome news to natural...