Slow-Burn Surge
Industrial Natural Gas Use Poised for Record Run
By Andrew Iraola, research analyst with the US Energy Information Administration
The US Energy Information Administration (EIA) forecasts US industrial natural gas consumption will climb to record highs through 2027 in its latest Short-Term Energy Outlook (STEO). Industrial consumption averaged a record 23.6 bcf/d (668.2 x 106 m3/d) in 2025, 1% more than the record 23.4 bcf/d (662.6 x 106 m3/d) reached in 2023. In its forecast, consumption gradually increases further in 2026 and 2027, as the EIA expects the natural gas-weighted manufacturing index to rise slightly over this period.
In its May STEO, the EIA forecasts average annual industrial natural gas consumption to increase by 1.2% (0.3 bcf/d [8.4 x 106 m3/d]) in 2026 and 1.7% (0.4 bcf/d [11.3 x 106 m3/d]) in 2027. Despite these incremental gains in annual consumption, growth remains gradual because increases in industrial activity are partially offset by efficiency gains. Continued efficiency improvements reduce the amount of natural gas needed per unit of output.
Much of industrial natural gas demand comes from the chemicals subsector and other manufacturing industries. The chemicals subsector is the largest industrial consumer of natural gas, using it to generate heat, generate electricity, and serve as a feedstock for methanol, fertilizer, and hydrogen production.
Industrial demand shows a seasonal pattern. Consumption is typically highest in winter, when colder weather can increase heating needs at industrial facilities. Industrial natural gas consumption averaged 26.1 bcf/d (739.06 x 106 m3/d) in January 2026, and the EIA forecasts it will average 26.7 bcf/d (756.05 x 106 m3/d) in January 2027. By comparison, consumption reaches seasonal lows during the summer months, with forecast volumes lowest for the month of June in 2026 and 2027, averaging approximately 22.6 bcf/d 639.9 x 106 m3/d).
Industrial natural gas consumption has been relatively flat since 2018, with the main exception of the pandemic-related decline in 2020 and the recovery in 2021 and 2022. Relatively low US natural gas prices encouraged expansion in some energy-intensive industries through the mid-2010s, including petrochemicals and ammonia production and refining, particularly along the US Gulf Coast. As a result, the industrial sector now consumes natural gas at a higher baseline rate, but the pace of new capacity additions has slowed.
Improvements in industrial efficiency have also slowed growth in industrial fuel use. Many facilities have adopted more efficient process heaters and heat-recovery technologies that reduce the amount of natural gas required per unit of output. However, in its forecast, rising industrial activity more than offsets these efficiency gains. The EIA expects the natural gas-weighted manufacturing index to increase by 1.5% in 2026 and 0.7% in 2027, contributing to slightly higher industrial natural gas consumption over the next two years.
