NATURAL GAS PRICING
Short-term weather has been the main driver of natural gas price movement in recent weeks. As forecasts point to colder conditions by mid-December, prices have climbed, with contracts from early 2026 through the end of 2028 now trading near the upper end of their recent range. At the same time, as December contracts approach settlement, some investors are taking profits and selling positions, which could pull the settlement price down toward $4.35, about 20 cents lower than just yesterday.
EIA Natural Gas Storage Report
The weekly EIA Natural Gas Storage Outlook report tracks the volume of natural gas in underground U.S. storage, revealing weekly fluctuations and comparison against 5-year averages.
NATURAL GAS SUPPLY AND STORAGE
Natural gas production hit a new record last week at 109.0 Bcf/d, helping to keep storage levels healthy even as winter begins. Higher demand and exports now above 18.0 Bcf/d have been offset by this strong production, limiting the impact of last week’s first withdrawal of the season at -14 Bcf.
NATURAL GAS PRODUCTION SNAPSHOT
Here’s where production stands versus recent history:
- Current production: 109.0 Bcf/d
- Day-over-day change: +0.3 Bcf/d
- Week-over-week change: +1.9 Bcf/d
- Month-over-month change: +1.8 Bcf/d
- 30-day average: 106.9 Bcf/d
- Year-over-year change: +4.6 Bcf/d
WINTER 2025/2026 NATURAL GAS PRICING
LNG EXPORTS
WEATHER OUTLOOK (NOVEMBER 25–30)
Mild, above-normal temperatures will dominate much of the U.S. through midweek, with highs mainly in the 40s to 60s across the northern states and upper 50s to 80s across the South. By midweek, a stronger cold system will push into the Rockies and Northern Plains, bringing lows in the single digits and teens and highs in the 20s and 30s. This colder air will spread into the Great Lakes and Northeast from Thursday through Sunday, increasing national heating demand. Energy demand should stay light to very light in the early part of the week, then pick up as the cold expands to more population centers.
NYMEX Natural Gas Calendar Strips
• The NYMEX 12-Month Strip averages the next 12 months of Henry Hub futures into one price. It’s a powerful indicator of market sentiment, allowing traders (and end-users) to lock in year-long coverage at a blended rate.
Watching shifts in this strip helps gauge the broader direction of gas markets, beyond just the prompt month.
(PJM) AD HUB DA & FWD TREND ANALYSIS
WHAT SHOULD YOU DO?
For many customers, this may be a good time to think strategically about the next 12–24 months rather than reacting day by day. With July and August power trading above $63.00/MWh—nearly double last summer’s levels—we could be nearing a peak in summer pricing. Consider:
- Watching for a pullback: If summer 2026 prices for July and August fall below $50.00/MWh, evaluate a 25% block purchase for those months.
- Timing winter-driven opportunities: If this winter turns out milder than expected, some traders who bought heavily on “colder-than-normal” forecasts may unwind positions, potentially creating a buying window from mid-January through February for well-priced blocks.
- Reducing premiums: Wherever possible, work to eliminate premiums on components like capacity and other pass-through elements of your rate.
- Considering a managed index approach: If your usage exceeds 1 million kWh annually, explore a managed index product that lets you:
- Lock in energy at low prices when they dip.
- Stay on an index rate when conditions are favorable.
- Shift into more protection when there are clear warning signs of higher prices ahead.
Over the past several years, this kind of managed strategy has often delivered lower overall costs than a fully fixed, all-in rate, while giving you more flexibility to act when the market moves in your favor.
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