# Natural Gas Slumps as Mild Weather Crushes Demand Outlook

Dec Nymex natural gas tanked 4.95% on Monday, caught in a perfect storm of bearish signals. Warmer-than-expected forecasts across the eastern US for late November are killing heating demand—the lifeblood of winter gas prices right now.

But that's just the appetizer. The real pressure? **US gas production is hitting record highs**, with lower-48 states pumping 110 bcf/day, up 7.1% year-over-year. Storage tanks are bulging too—inventories rose 45 bcf last week, beating the consensus of 34 bcf. As of early November, gas reserves were already 4.5% above the 5-year average.

The EIA didn't help matters. They just bumped 2025 production forecasts to 107.67 bcf/day (+1% from September), signaling sustained supply abundance. Active drilling rigs remain elevated at 125, though cooling slightly from November's 2.25-year peak.

One bright spot: US electricity output rose 2.84% year-over-year over the past 52 weeks, suggesting underlying demand. Still, with Europe's gas storage sitting at 82% (vs. 91% seasonal average), global markets are equally oversupplied.

Bottom line: Until heating demand kicks in hard or production gets slashed, nat-gas bulls are fighting upstream.