Mother Nature’s outlook for the balance of August 2025 is starting to form how energy traders are looking at the natural gas landscape as the prompt month forward curve slipped down to $2.80 for Tuesday’s close.

Figure 1 | ConUS CDD/HDD Forecast vs. Last Year and Normal – by 5-Day Period (AG2)

The figure above illustrates how the 15-day temperature forecast (blue) is shaping up compared to the previous run (red dotted), last year for the same days (gold) and what is considered normal (downward trending gray line). What is clear is that the current heat will last through the weekend before we see a big shift lower and transitioning to the last 10 days of the month attracts modest temperatures spreading across the country.

If this pattern holds and extends into the start of September (Labor Day weekend), the front of the natural gas forward curve will not be able to hold onto the $2.80 level that is on display. To put the move down in perspective, the market was sitting up around the $3.50 level in the middle of July as warmer temperatures across the Midwest, Ohio Valley and Northeast were prompting the power burns and there was still plenty of summer left. Now that we have moved into August and have a good idea of what lies ahead, the first two months of Q3 will be in the books and all that is left of summer is the month of September. Once we get back half of this month, conversation around the fall and beginning of winter take front and center while summer fades into the sunset.

Figure 2 | ERCOT 12x24 Profile Summary

Circling around North America, there has been a common theme across most of the ISO regions with the initial task of tackling load growth that is in play. The good news for the system operators is the fact that coal generation is present, which is something we saw during the winter months as well. This resource has seen a revival over the past 12 months and if the trend continues it will help keep a lid on the natural gas generation fleet thus putting more downward pressure on the forward near-term Nymex curve. The other factors, which are discussed daily as part of the Energy GPS Market Analytics Enterprise Product Offering content (for more information, click on the Contact Us link under the About Us section of the Energy GPS website) are attributable to the renewable energy sector where solar output continues to climb across the country. Figure 2 displays the 12x24 ERCOT profiles where solar is in the middle horizontal frame. When you account for both wind and solar, the power demand net load takes on a different shape compared previous years and with the addition of battery capacity, the grid operations feel confident in the daily/hourly balancing act.

Like anything else in the energy industry, the self-correcting price signal never keeps things at a standstill very long and with load growth conversations around the data center buildout, the shifting landscape tied to thermal generation and state level renewable standards the statement should hold true but it will take a little time given the current power and natural gas landscape.