Key Facts
- US natural gas at Henry Hub has remained near $3.00/MMBtu despite the Persian Gulf crisis pushing Brent and WTI crude sharply higher, according to broker Elev8.
- Elev8 cites a late-April low around $2.50/MMBtu; the EIA’s April spot average was $2.77/MMBtu, with a forecast 2Q26 average of $2.83/MMBtu.
- Elev8 attributes the divergence to six structural factors, including the regional (rather than global) nature of gas markets, vast US shale reserves, capped LNG export infrastructure, and renewables displacing gas in power generation.
- Kar Yong Ang, financial market expert at Elev8, says a geopolitical oil boom can actually worsen a domestic gas glut by spurring associated-gas output from oil drilling.
- Elev8 sees the technical trend as bullish but flags a likely retracement toward $2.900, with potential downside to $2.750 if weather is cooler than expected.
US natural gas has stayed conspicuously calm while the rest of the energy complex has rallied. As the Persian Gulf crisis pushes Brent and WTI crude sharply higher and lifts the European TTF and Asian JKM gas benchmarks, the US Henry Hub benchmark has remained near $3.00 per million British thermal units — and, according to global CFD broker Elev8, dipped to a low around $2.50/MMBtu in late April. The divergence, the broker argues, is a textbook illustration of how regional gas dynamics decouple from global oil trading.
Why US gas struggles to follow oil
Elev8 sets out six structural reasons why US natural gas has not tracked oil during the crisis — and may struggle to rise for the foreseeable future.
The first is market structure. Unlike the global oil market, natural gas is composed of distinct regional markets rather than a single global one. A Persian Gulf crisis directly threatens international shipping lanes and disrupts the European (TTF) and Asian (JKM) 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 fundamentally tied to local supply and demand.
The second is the sheer scale of US reserves — estimated by Elev8 at 29.4 billion barrels of shale oil and 379.4 trillion cubic feet of shale gas. That volume 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.
Source: TradingView, Elev8 brokerInfrastructure, renewables and coal
The third factor is the export bottleneck. While high global prices make exporting US liquefied natural gas highly profitable, the country cannot build new export terminals overnight. Existing facilities can only run 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.
Fourth, renewables are actively displacing gas in the power sector. Elev8 cites Bluegold Trader 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.
Fifth, the retirement of coal-fired power plants has slowed. Driven by the massive expected electricity demand from data centres, 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.
The sixth and most immediate factor is 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
The phenomenon Elev8 describes is consistent with official data. The US Energy Information Administration noted in March that although reduced LNG flows through the Strait of Hormuz had pushed European and Asian prices higher, it expected US gas prices to be relatively unaffected because of mild late-winter 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 it forecast Brent crude staying above $95 over the following two months.
For active traders, the broker frames this as 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 bluntly. “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,” he said. “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 sees the trend as bullish but 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.
The broader lesson Elev8 draws is one that recurs across commodity markets: correlation between related assets breaks down precisely when traders most expect it to hold. A Gulf crisis that lifts oil and international gas can leave US gas flat or falling, because the same event that tightens global supply loosens the domestic one. This article reflects Elev8’s analysis and does not constitute investment advice; CFDs are leveraged products that carry a high risk of rapid loss.
