Investing.com -- Morgan Stanley (NYSE:MS) has revised its forecast for U.S. natural gas prices in 2025. The bank's analysts attribute this change to the ongoing LNG expansion cycle and the increasing heating demand due to what is projected to be the coldest January in a decade.
The bank now predicts that prices at Henry Hub will average $4.15 per million British thermal units (mmBtu) this year, a rise from the previous estimate of $3.75/mmBtu.
Additionally, Morgan Stanley has reduced its storage estimate for the end of March from 1.84 trillion cubic feet (Tcf) to 1.55 Tcf. This represents a decrease of about 17% below the 5-year average.
The analysts noted that winter weather has been a beneficial factor so far, but it remains an unpredictable element for the 2025 outlook. If February and March bring milder weather, inventories could remain at around 1.8 Tcf.
However, if the winter withdrawal season concludes with colder-than-normal conditions, stock levels could drop to approximately 1.3 Tcf, they said.
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