Henry Hub
The US natural gas spot-price benchmark near Erath, Louisiana, where 13 pipelines converge and the world's most-traded gas futures contract settles.
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What it is
Henry Hub is a natural gas pipeline interconnection operated by Sabine Pipe Line LLC near Erath, Louisiana, in the US Gulf Coast's Vermilion Parish. Nine interstate and four intrastate pipelines converge there, linking offshore Gulf of Mexico production and onshore Texas-Louisiana supply to trunk lines serving the US Midwest, Northeast, and Southeast. Since April 1990, NYMEX, now part of CME Group, has designated it the official delivery point for its Natural Gas Futures contract, the world's highest-volume gas derivatives instrument. The daily spot price, denominated in US dollars per million British thermal units (US$/MMBtu), is North America's primary gas benchmark and an anchor for global LNG pricing.
History
The hub takes its name from a Texaco gas processing plant that once sat at the pipeline confluence in Vermilion Parish, known locally as "Henry's." Physical spot trading at the site began in the early 1980s as US federal regulation started decontrolling wellhead gas prices, a process completed by the Natural Gas Wellhead Decontrol Act of 1989. NYMEX chose the hub as the delivery point for its Natural Gas Futures contract in April 1990, a decision that bound Henry Hub's local clearing price permanently to global financial markets. CME Group acquired NYMEX in 2008 and migrated the contract to electronic trading, but the physical delivery specification and the hub's central role remained unchanged. The 10,000 MMBtu contract unit set in 1990 is still the standard.
Current state
As of mid-2026, Henry Hub sits at the fulcrum between two countervailing forces. The US Energy Information Administration's June 2026 Short-Term Energy Outlook projected an average Henry Hub price of US$3.60/MMBtu for full-year 2026, marginally above 2025 levels but well below the US$6-9 spikes of 2022. Record LNG feedgas demand, growing in step with new export capacity additions, is pulling the benchmark upward. Permian Basin associated gas, rising roughly 3.3% year-on-year, is offsetting that pull and keeping prices compressed. The US gas stays cheap as Permian supply outruns record LNG pull story documents how those forces are balancing week by week.
Relationships
Henry Hub is the US node in a global LNG pricing triangle alongside the Netherlands' Title Transfer Facility (TTF) and the Japan-Korea Marker (JKM). When the spread between Henry Hub and TTF or JKM widens, US LNG cargoes become more competitive abroad, drawing more feedgas to Gulf Coast terminals and tightening domestic supply. Sabine Pipe Line connects to Transcontinental Gas Pipe Line (Transco), Southern Natural Gas, Tennessee Gas Pipeline, and several other major interstate carriers. The Golden Pass terminal's first cargo in June 2026, which added 2.0 Bcf/d of nameplate capacity as the ninth US LNG export terminal, is the clearest recent illustration of how new export projects translate directly into increased feedgas demand at the hub.
What to watch
Three signals will determine whether Henry Hub holds above US$3.50 through end-2026: the ramp pace of Golden Pass's three LNG trains toward full nameplate capacity; whether Permian associated-gas growth continues to outrun LNG feedgas pull, which the EIA sees persisting through at least end-2026; and how many long-term Henry Hub-indexed LNG contracts European buyers finalize as they seek to reduce dependence on Russian pipeline gas into the 2027-2030 period.