AI energy update

With the AI market story revolving almost exclusively around “disruption” in recent weeks, it may be a good time to revisit one of the original themes of the GenAI boom—energy.

While crude oil prices on Thursday rallied to their highest level since last summer amid US-Iran tensions, the natural gas market was winding down a relatively quiet week. On Thursday, April natural gas futures (NGJ6) were trading near their one-month lows, having pulled back sharply from their late-January high, when prices briefly spiked to their highest level since 2022:

While the twists and turns of the fossil fuel markets may seem far removed from AI, they’re not. This is perhaps especially true for natural gas, which has long been cited as a primary alternative power source (along with nuclear) for the explosive growth in AI data centers.

New research from Morgan Stanley & Co. describes the US natural gas market as being “on the cusp of a new cycle of demand growth,” expanding at roughly twice the rate of electricity demand and three times US GDP. Specifically, the report notes there are 1,272 announced AI data center projects in the US, which the analysts estimate will inflate domestic natural gas demand by +4.8 billion cubic feet per day by 2030—a roughly 4% increase.¹

While that may sound like good news for US natural gas stocks across the board, the logistical realities of this growth suggest that may not necessarily be the case. As the report explains, new AI-oriented data center development is highly concentrated in the Mid-Atlantic region, particularly in the Pennsylvania-New Jersey-Maryland (PJM) market and Virginia.

That means potential AI-natural gas leaders could be the companies with “proximity advantages” to this region—including EQT (EQT), which on Thursday rallied to its highest price since early December 9, just shy of its all-time high of $62.23:

While the stock has roughly doubled since August 2024, it has also spent the better part of the past year in a choppy consolidation, trading mostly between $45 and $60—to a certain extent, mirroring the volatility in natural gas itself.

As the analysts explain, the difference in potential outcomes among different natural gas companies because of their proximity advantages hasn’t yet been fully reflected in stock prices, but should become “increasingly evident” over the next one to two years.

It may be on the back burner right now, but the AI-energy story isn’t going anywhere, and it’s likely still in its early chapters.

Market Mover Update: April WTI crude oil futures (CLJ6) climbed more than 2% on Thursday, breaking out (at least temporarily) from a nearly three-week consolidation:

While the course of US–Iran negotiations over the latter country’s nuclear program is as unpredictable as oil prices themselves, expectations of supply disruptions because of geopolitical tensions and surprises have sometimes proved to be short-lived. For example, the five-day, 16% jump in crude oil prices that accompanied Israeli and US airstrikes on Iran in June 2025 was almost completely reversed in just two days.

Today’s numbers include (all times ET): GDP (8:30 a.m.), Personal Income and Spending (8:30 a.m.), PCE Price Index (8:30 a.m.), New Home Sales (10 a.m.), Consumer Sentiment (10 a.m.).

Today’s earnings include: PPL (PPL).

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¹ MorganStanley.com. Identifying Key Beneficiaries Across the Natural Gas Value Chain from AI/Data Center Development. 2/19/26.