Henry Hub natural gas spot prices will climb back above the $3/MMBtu threshold on average next year, though associated output from the Permian Basin will keep production elevated, according to updated projections from the U.S. Energy Information Administration (EIA).

STEO

Domestic production is expected to remain at “relatively high levels” throughout 2023 even as natural gas prices have declined sharply, with Henry Hub averaging just $2.41 for the first half of the year, EIA said in its latest Short-Term Energy Outlook (STEO), published Tuesday.

The updated STEO models an average Henry Hub spot price of $2.54/MMBtu for the third quarter and $2.95 for 4Q2023. Prices are on track to average $2.58 for full-year 2023 and are expected to increase to $3.23 on average in 2024,...