Opening
During the Persian Gulf crisis, US natural gas at Henry Hub has remained near $3.00 per million British thermal units (MMBtu), with a late-April low around $2.50/MMBtu, according to global CFD broker Elev8 — even as Brent and WTI crude have surged sharply higher. The divergence reflects a fundamental disconnect between regional and global energy markets. Elev8 attributes this anomaly to six structural factors: the regional nature of US gas markets rather than global trading, vast domestic shale reserves (29.4 billion barrels of shale oil and 379.4 trillion cubic feet of shale gas), capped LNG export infrastructure, renewables displacement in power generation, slowed coal-plant retirements, and weather-driven demand fluctuations. The US Energy Information Administration confirmed in March that although reduced LNG flows through the Strait of Hormuz pushed European (TTF) and Asian (JKM) gas benchmarks higher, US gas prices were expected to remain relatively unaffected due to mild weather and rising domestic production. The EIA's April Henry Hub spot price averaged $2.77/MMBtu, with a forecast 2Q26 average of $2.83/MMBtu — roughly 11% lower year-on-year — even as Brent crude was forecast to stay above $95 over the following two months.
Why US Gas Struggles to Follow Oil
Elev8 identifies six structural reasons why US natural gas has not tracked oil during the crisis and may struggle to rise in the near term.
Market Structure. Unlike the global oil market, natural gas comprises distinct regional markets rather than a single global one. A Persian Gulf crisis directly threatens international shipping lanes and disrupts European and Asian benchmarks, but the US market remains heavily insulated by geographical isolation and vast domestic infrastructure. As the world's largest gas producer and a net exporter, the US has limited physical exposure to Gulf disruptions, leaving Henry Hub tied to local supply and demand.
Shale Reserves and Associated Gas. The sheer scale of US reserves means any threat of structural shortage is easily absorbed by domestic capacity. Critically, higher oil prices from Middle East tensions encourage US shale firms to ramp up drilling in oil-rich basins like the Permian, where gas is extracted as "associated gas" — a byproduct of oil production. A global oil rally therefore triggers a domestic gas-supply expansion, exerting downward pressure on Henry Hub.
LNG Export Bottleneck. While high global prices make exporting US liquefied natural gas highly profitable, the country cannot build new export terminals overnight. Existing facilities operate at maximum capacity, pulling a steady but capped baseline of 12 to 14 billion cubic feet per day out of the domestic market and leaving the rest of supply trapped at home, pressuring local prices.
Renewables Displacement. Renewables are actively displacing gas in the power sector. Elev8 cites data indicating renewables are displacing up to 10 Bcf/d of gas burn, with over 230 Bcf displaced in the past 30 days alone — a structural shift that caps price upside even as overall power demand grows.
Coal Retirement Slowdown. The retirement of coal-fired power plants has slowed, driven by massive expected electricity demand from data centers, AI, and cryptocurrency mining. Coal generation may actually rise in the near term, biting into market share that would otherwise go to gas-fired generation.
Weather. Long-term geopolitical conflicts usually matter less to gas prices than local weather forecasts. Recent mild US weather has kept heating and cooling demand low, pushing storage inventories well above normal. Brief price jumps are possible if hotter weeks arrive, but daily weather updates still drive the market far more than overseas political risk.
The Intermarket Anomaly for Traders
For active traders, the phenomenon creates a compelling intermarket setup for energy Contracts for Difference. The crisis has driven oil benchmarks and international gas benchmarks higher while leaving US gas anchored to domestic fundamentals — creating a divergence that can be expressed through CFD positions on the relevant benchmarks. Elev8 says it continuously monitors such intermarket anomalies to give clients data and execution for informed decisions.
Elev8's Outlook
Kar Yong Ang, financial market expert at Elev8, frames the central misconception: "Many market participants expected U.S. natural gas to automatically mirror oil spikes during a Middle East crisis, but U.S. Henry Hub prices are driven by domestic fundamentals and often ignore distant risk premiums. Indeed, a geopolitical oil boom can actually worsen a local natural gas glut, putting severe downward pressure on short-term spot prices."
On the technical picture, Ang expects a pullback. "A retracement towards $2.900 seems likely, and should the weather turn out to be cooler than expected, the natural prompt-month futures contract may drop as low as $2.750," he said.
FAQ
Why hasn't US natural gas risen with oil during the Persian Gulf crisis?
According to Elev8, US natural gas trades in a regional market insulated from Gulf disruptions by geography, vast domestic shale reserves, and self-sufficiency as a net exporter. Higher oil prices actually encourage more US oil drilling, which produces additional "associated gas" as a byproduct, increasing domestic supply and pressuring Henry Hub prices lower rather than higher.
What is the difference between Henry Hub and global gas benchmarks?
Henry Hub is the US natural gas benchmark, driven primarily by domestic supply, demand, and weather. The European TTF and Asian JKM benchmarks are exposed to global LNG shipping flows and have risen during the Persian Gulf crisis due to disruptions at the Strait of Hormuz. US LNG export capacity is capped by infrastructure, which limits how much the global price strength can pull through to Henry Hub.
What is Elev8's price outlook for natural gas?
Elev8's Kar Yong Ang views the technical trend as bullish but expects a retracement toward $2.900/MMBtu. If weather is cooler than expected, he sees the prompt-month futures contract potentially falling as low as $2.750/MMBtu. This reflects the broker's view that domestic weather and production fundamentals outweigh geopolitical risk premiums for US gas.
