Permian Oil Drives Gas Glut That Won't Self-Correct

Permian Basin associated gas—a byproduct of oil drilling—is growing independently of natural gas prices because oil, not gas, drives drilling decisions. This creates an inelastic supply problem: drillers won't cut oil production when gas prices fall. The result mirrors 2019–2020 dynamics, when Waha hub traded negative. Current softness near $2.83/MMBtu won't stop production growth, leaving excess gas competing for pipeline and storage capacity regardless of price signals.