WASHINGTON: The United States is entering a period of structurally higher industrial natural gas demand, with consumption expected to remain at record levels through at least 2027, even as the Iran war intensifies disruptions across global oil markets and tightens energy supplies worldwide.
According to the latest Short-Term Energy Outlook (STEO) from the US Energy Information Administration (EIA), industrial natural gas consumption in the United States averaged a record 23.6 billion cubic feet per day (bcfd) in 2025, exceeding the previous high of 23.4bcfd recorded in 2023.
The projections suggest that rising industrial demand is no longer merely cyclical, but increasingly tied to deeper structural shifts in manufacturing, energy trade flows and global supply-chain realignment.
The EIA expects industrial gas consumption to rise by another 1.2 per cent, or 0.3bcfd, in 2026, followed by an additional 1.7pc increase, or 0.4bcfd, in 2027.
At the centre of the trend is sustained expansion in energy-intensive manufacturing sectors, including petrochemicals, fertilizers, metals processing and export-oriented industrial production. These industries continue to benefit from the United States’ relative energy cost advantage compared with Europe and parts of Asia, where fuel prices remain significantly higher.
However, the pace of growth is being moderated by ongoing efficiency improvements across industrial operations.
“Continued efficiency improvements reduce the amount of natural gas needed per unit of output,” the EIA noted, indicating that overall demand growth would likely have been substantially higher without technological gains in industrial energy use.
Iran war intensifies pressure on global oil markets
The revised US energy outlook comes amid escalating geopolitical tensions in the Middle East, where the Iran war has evolved into one of the most significant threats to global energy security in recent years.
The EIA this week sharply revised its assumptions for global oil supply disruptions, warning that interruptions to Middle Eastern exports are likely to be both deeper and more prolonged than previously anticipated.
Central to the disruption is the Strait of Hormuz, the world’s most strategically important oil transit chokepoint, through which roughly one-fifth of globally traded crude oil normally passes.
The agency now assumes the strait will remain effectively closed through the end of May, extending earlier expectations that disruptions would ease by April.
