Demand is growing, too, but more slowly. Total U.S. natural-gas consumption is up 5.5% this year through May, spurred largely by a gradual shift from coal power plants to cleaner-burning gas-fired ones. Consumption actually fell slightly between 2003 and 2006.

As some analysts have begun to toss around terms like “gas glut,” natural-gas futures have tumbled 9.2% in the past two weeks, and they have brought producers’ stocks down with them. Shares of large natural-gas producers Chesapeake Energy Corp., XTO Energy Inc. and EOG Resources Inc. are all down 30% or more from their recent highs in late June and early July. By comparison, oil-focused Exxon Mobil Corp. is down 17% from its recent high May 20.

“I think that supply growth has become the 800-pound gorilla in the North American gas investing equation,” said Dan Pickering of Tudor Pickering Holt & Co., an energy-focused investment bank.

For consumers, increased supplies of natural gas could mean lower heating and cooling bills, as the fuel generates a fifth of the nation’s electricity and heats half of the U.S.’s homes. But any relief is likely to be limited. Analysts say that if natural-gas prices settle below $8 per million British thermal units, producers will cut back production — which will tighten supplies and drive prices up again.

“It’ll be essentially a self-correcting mechanism,” EOG Chief Executive Mark Papa said.

Cutbacks in production could spell trouble for producers and their investors. Unlike Big Oil, most independent producers aren’t using their cash to buy back stock or pay big dividends. They have been plowing it back into drilling, because Wall Street values the companies on their growth potential. If lower prices force producers to slow their drilling, their growth will slow, too.

To prevent that, the industry in recent months has cranked up its lobbying to boost long-term demand for natural gas. In television ads and congressional testimony, the industry has been touting natural gas as cheaper than oil, cleaner than coal and domestically produced.

“Find me the congressman or find me the policy maker who’s against cleaner energy, cheaper energy and American energy,” Chesapeake Chief Executive Aubrey McClendon said in an interview.

Mr. McClendon, whose company expects to become the nation’s top natural-gas producer by the end of the year, has been especially aggressive. Late last month he lobbied Washington lawmakers to promote compressed natural gas as an alternative to gasoline.

In an interview, Mr. McClendon said he wants to make lawmakers and the public aware of the potential for natural gas.