Wood Mackenzie: U.S. Gas Sector Set to Benefit as Henry Hub Prices Poised to Climb
(P&GJ) — Shale gas may operate in the shadow of tight oil, but that could soon change. According to Wood Mackenzie analysts, rising demand for natural gas is set to drive Henry Hub prices higher — creating significant opportunity for gas producers across the U.S.
“We forecast Henry Hub prices will rise from the current $3.50/mmbtu to average $5.00/mmbtu by 2030, and $6.00/mmbtu by 2035,” said Alex Beeker, Director of Corporate Strategy and Analytics, and Dulles Wang, Director of Gas Research at Wood Mackenzie. This represents a substantial shift from previous forecasts, largely driven by growing demand from data centers, LNG exports, and manufacturing.
Top Players Best Positioned
Wood Mackenzie notes that the U.S. Lower 48 gas production space is highly concentrated, with the top 10 producers accounting for 30% of supply. Independents like Expand and EQT derive over 90% of their production from the region, while Ascent and Antero exceed 60%. These companies are among the most leveraged to price increases, the analysts said.
Even for supermajors such as ExxonMobil, Chevron and ConocoPhillips, U.S. Lower 48 gas plays still make up nearly a third of domestic production, keeping them materially exposed to any upside.
Supply Can Meet Demand—At a Price
Wood Mackenzie emphasized that there is ample gas resource, but warned that producers remain cautious with capital amid uncertainty around tariffs and material costs. “Gas producers are adhering to capital discipline and will require Henry Hub prices at or above $5.00/mmbtu by the end of the decade to unlock necessary supply,” Beeker and Wang said.
They also noted that declining budgets from tight oil producers could reduce associated gas supply, further tightening the market.
Market Isn’t Pricing in the Upside Yet
Despite the bullish outlook, Wood Mackenzie said the market has yet to reflect the potential price surge. The forward curve remains flat, pricing in just $3.51/mmbtu by 2030. M&A activity also suggests buyers are valuing assets based on a long-term Henry Hub price of $3.35/mmbtu.
Publicly traded gas producers such as EQT, Expand, Antero and Range are trading in line with the curve — but at a 25% to 50% discount compared to Wood Mackenzie’s forecast.
Big Oil Could Capitalize
The report suggests that Big Oil players with existing U.S. gas exposure and LNG infrastructure — including ExxonMobil, Chevron, BP, and ConocoPhillips — are best positioned to benefit from a move into more upstream gas resources. TotalEnergies and Equinor have already made strategic acquisitions, while others like ADNOC and Saudi Aramco may follow suit to hedge their U.S. LNG offtake.
Downside Risks Remain
Wood Mackenzie identified several risks to the bullish scenario, including policy shifts that favor renewables like solar and nuclear over natural gas for data center power. The analysts also noted that higher gas prices could attract new supply or prompt regulatory approval of delayed infrastructure projects, which could temper the market.
Nonetheless, Wood Mackenzie’s outlook highlights a potential shift in sentiment around U.S. shale gas — and a window of opportunity for well-positioned producers.
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