Henry Hub Falls to $3.16 While TTF Holds at 43.79 EUR per MWh, Pushing the Gross LNG Export Spread to $11.47 per MMBtu

Henry Hub front-month natural gas futures fell to $3.16 per MMBtu in early Wednesday morning trading, per Trading Economics, while European TTF natural gas climbed to 43.79 EUR per MWh. At an EUR/USD exchange rate of 1.14000, TTF converts to roughly $14.63 per MMBtu, leaving a gross transatlantic spread of $11.47. At that spread and June's average US LNG export rate of 17.4 billion cubic feet per day, the gross daily arbitrage across the US LNG sector totals approximately $199 million.

Why Henry Hub Fell and TTF Rose

The US price decline reflects cooling weather forecasts that signal a reduction in air-conditioning demand and gas-fired electricity generation, according to Trading Economics market commentary. Henry Hub stood at $3.33 per MMBtu on Monday June 29, per EIA spot price data, and has eased roughly 5% since then. Gas inventories across the Lower 48 states remain 5.9% above seasonal norms, adding downward pressure. Lower 48 production held at 110.0 billion cubic feet per day in recent weeks.

TTF moved in the opposite direction, rising 1.79% as of early Wednesday trading per Trading Economics. The specific overnight catalyst for the European move was not identified in available market data. European natural gas markets have shown greater sensitivity to geopolitical supply signals, with the six-month Hormuz crisis having led European buyers to compete more actively for long-term LNG supply contracts.

The Spread Math and What It Means for US Exporters

Converting TTF to a US dollar basis: 43.79 EUR per MWh, divided by 3.412 MMBtu per MWh, equals 12.83 EUR per MMBtu. Multiplied by the EUR/USD rate of 1.14000, that equals $14.63 per MMBtu. Subtracting Henry Hub's $3.16 gives a gross spread of $11.47 per MMBtu. Typical US LNG export economics involve tolling fees and shipping costs in the range of $3 to $5 per MMBtu, leaving a net margin in the range of $6.47 to $8.47 per MMBtu exported.

Applying the gross spread to the June average export rate: 17.4 billion cubic feet per day equals approximately 17.4 million MMBtu per day. At $11.47 gross spread, the sector-wide daily gross arbitrage is roughly $199 million. US natural gas producers with Permian Basin exposure, including Devon Energy, benefit indirectly when export demand holds Henry Hub above the sub-dollar Waha spot prices that prevailed before the LNG buildout. Permian gas production reached 27.6 billion cubic feet per day in 2025, per the EIA, growing 60% from 17.2 billion cubic feet per day in 2021.

LNG Contract Language Under Review After Hormuz Disruption

The Oxford Institute for Energy Studies warned this week that the Hormuz closure could prompt the biggest rewrite of LNG contract language in years, according to Oil and Gas Journal. The institute cited requirements for revised source-specific force majeure terms and new cargo resumption protocols. European and Asian buyers experienced firsthand how a single chokepoint can interrupt LNG flows nominally covered by long-term supply contracts. The spread between Henry Hub and TTF, favorable for US exporters, also reflects the premium European buyers now pay for supply routes outside Gulf chokepoints.

Qatar and the United States jointly warned the European Union in late June against methane regulations that could penalize LNG imports, citing supply security concerns, according to OilPrice.com. The EU methane regulation dispute adds further uncertainty to the long-term competitiveness of Gulf LNG versus US LNG in the European market. With TTF at 43.79 EUR per MWh and Henry Hub at $3.16, US exporters hold a structural cost advantage even before accounting for transit route risk.