Why Natural Gas Is Not Rising as Quickly As Gasoline

Quick overview

A massive drop for U.S. natural gas futures on Thursday was caused by higher than normal inventory injections, and yet gasoline at the pump has slightly increased from the previous day.

LNG rates in the United States dropped by 5.18% Thursday to hit $2.58 per MMBtu as oversupply reports came in. That is the lowest the price has been since October of 2024. Federal reported levels showed plenty of gas in storage and in injection of 103 billion cubic feet for the week of April 17th.

That is far more than anyone was expecting and well above the five-year average of 64 bcf. The same week last year, there was a 77 bcf injection, so production levels are way up. High production and high inventory are pushing prices down since inventories are still high from last year’s unseasonably warm middle months. The mostly mild winter throughout the United States for 2025-2026 has not helped the oversupply problem either, keeping prices subdued while global rates are much higher.

Gasoline and Natural Gas Factors Compared

The United States produces most of its own natural gas, having to import very little. All of those imports come from Western Hemisphere nations, specifically from South America and the Caribbean. That explains why the energy crisis in the Middle East is not affecting LNG rates much domestically.

As Iran and the United States fight it out over the Strait of Hormuz, oil prices globally are on the rise, with Brent crude oil jumping 3.79% over the last 24 hours. West Texas Intermediate oil, which serves as a benchmark price for global oil prices, is up by nearly 4% today.

Those rising global oil prices are why gasoline at the pump is so high for Americans. About 13% of the U.S. oil that is turned into gasoline comes from Persian Gulf countries, and when the supply is hindered by fighting over the Strait of Hormuz or by oil tankers being attacked, then prices rise at the pump. The oil brought into the US is put through a process called fractional distillation that turns it into gasoline suitable for combustion engines.

Over the last month, premium grade gasoline has climbed from $4.82 to $4.90 per gallon. That is the average price across the United States, and it may decrease if the U.S. and Iran can keep their current ceasefire.

Domestic LNG prices are more influenced by the weather and inventory levels than anything else. Because of the strong influence of these factors, LNG rates can move in a dramatically different way than gasoline. If the weather cools as it is supposed to in the coming weeks, the price of natural gas could rise, but high inventory levels will likely keep any price increases subdued.

ABOUT THE AUTHOR See More

Timothy St. John

Financial Writer - European & US Desks

Timothy St John is a seasoned financial analyst and writer, catering to the dynamic landscapes of the US and European markets. Boasting over a decade of extensive freelance writing experience, he has made significant contributions to reputable platforms such as Yahoo!Finance, business.com: Expert Business Advice, Tips, and Resources - Business.com, and numerous others. Timothy's expertise lies in in-depth research and comprehensive coverage of stock and cryptocurrency movements, coupled with a keen understanding of the economic factors influencing currency dynamics. Timothy majored in English at East Tennessee State University, and you can find him on LinkedIn.

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