The drillers behind America’s energy-dominance story are paying buyers to take their gas.
In the Permian Basin — the biggest, most productive oil field the country has ever had — natural gas prices averaged negative $2.19 per million British thermal units at the Waha trading hub during the first half of 2026. Producers were not just giving gas away. They were paying customers to haul it off. In late April, when oil prices neared $100 a barrel, Permian gas hit a record low of negative $7.95. The same day, the national benchmark at Henry Hub in Louisiana sat at $2.72.
The LP truck that fills tanks across Adams County charges what it charges regardless of what happens at Waha. The diesel pump at the co-op in Friendship does not know or care that Diamondback Energy, one of the Permian’s biggest operators, sold oil for an average $96.82 a barrel last quarter while selling its gas at negative $2.15 per thousand cubic feet. When I heat my pole barn, the price I pay is set by Henry Hub, not by the glut a thousand miles south in West Texas. The gusher and the gas bill are connected by a pipe that does not exist yet.
As the conflict with Iran drove global oil prices toward $100 a barrel this spring, producers in the Permian Basin pulled more from the record West Texas output that had been stabilizing domestic supply. Oil is what they are after. Gas comes out of the same wells as a byproduct. When oil is profitable, producers keep pumping regardless of what happens to the gas. They drilled so much that the region’s pipelines could not carry it all away. The gas had nowhere to go. Producers paid buyers to take it. Some burned it at the wellhead — flared it — though regulatory limits constrain how much of that they can do. Devon Energy and APA curtailed output. Diamondback turned rigs away from gassier prospects. When the flagship oil patch has to stop drilling some wells because the pipeline is not there, the drilling mandate is not just incomplete — it is working against itself.
Wendell Berry wrote in The Unsettling of America about the extractive mind — the mentality that treats land and what comes out of it as expendable inputs to a balance sheet. The Permian gas glut is the extractive mind applied to a fuel. Gas is treated as a nuisance because the wells were drilled for oil. Nobody built the pipes because the financial structure did not require the pipes — only the wells.
Bethany McLean, who documented Enron’s collapse and then wrote Saudi America about the shale industry’s financial architecture, identified the mechanism years ago. The shale patch runs on Wall Street capital, not on cash flow from production. Growth comes from debt-funded drilling, not from free cash flow. The infrastructure to move what comes out of the ground is an afterthought because the money is in the drilling, not in the piping. The gas sells for negative $2.19, and nobody goes bankrupt because nobody was counting on the gas.
This is the Nationalist Shell Game as Chapter 16 of We Too names it: the rhetoric of energy dominance masking an infrastructure reality that undercuts the promise. The same administration selling “energy dominance” as a trade strategy and a national-security guarantee presides over an oil patch that cannot give away one of the two fuels it produces. Twenty percent of the country’s natural gas comes from the Permian Basin. That gas underpins electricity generation, manufacturing, and the artificial-intelligence data centers that policymakers keep talking about. It is the gas exported as part of trade deals. And for half of this year, producers in that basin have been paying buyers to take it because the pipes are not there.
Three new pipelines are helping. Kinder Morgan added capacity to the Gulf Coast Express. Energy Transfer’s Hugh Brinson pipeline began operating this summer, running about 400 miles toward Dallas. The Blackcomb pipeline, built by a consortium including Targa Resources, opens later this year. But analysts at East Daley Analytics warn the relief may be temporary. Gas production grows faster than crude in the Permian, and the next batch of pipelines does not come online until later this decade. If oil prices stay high and the Strait of Hormuz stays contested, producers will keep drilling, and the pipes will fill right back up. Jennifer Kneale, president of pipeline operator Targa Resources, told investors this spring that the situation was “arguably going to continue to get worse before it gets better.” That is an executive at a pipeline company admitting her company cannot build fast enough.
Some producers are looking for ways to use the gas themselves rather than pay someone to take it. Chevron plans to build a gas-fueled power plant in Reeves County, Texas, to feed electricity to a Microsoft data center. Matador Resources touted savings from running drilling equipment on its own gas rather than purchased fuel. These are rational moves. They are also what happens when the market for your product is so broken that burning it yourself is the best option.
The argument for drilling more — the argument the administration has been making since the war started, the argument the oil patch makes, the argument that sounds right when you are paying four dollars at the pump — is that more production means lower prices and more security. But production has never been the whole story. It is a political failure to talk about drilling more without talking about piping more. The pipe is half the promise. The gas is in the ground. The wells are drilled. The gas is coming out. And it is selling for less than zero because nobody built the pipe.
In Adams County, the LP truck fills the tank at whatever Henry Hub says it costs, and the shop owner pays it. The energy-dominance story does not arrive at his meter. The infrastructure failure does. Someone made the promise to drill. No one made the promise to pipe. The voter who pays for the missing pipe deserves to know why.