Although operators continue to shift drilling activity from gas-focused basins to liquids-rich shale plays, the associated gas extracted these plays should ensure that the supply overhang persists. In the first quarter of 2012, natural gas output increased by 8.7 percent from the first three months of 2011. At the same time, elevated inventories suggest that US natural gas production could overwhelm storage capacity in early fall, an outcome that would send prices tumbling.