NYMEX Futures Price Hits 21-Month Low, Settles at $2.68/MMBtu

This is getting painful. Are we beginning to settle into "lower for longer" once again, with natural gas prices trading in the $2-$3 range? Gosh, we sure hope not. Yesterday was the first full day of the March 2023 NYMEX futures contract for natural gas as the "front month." The February contract "rolled off" (i.e. ended) last Friday, and yesterday the March contract became the new contract that functions as the default price for the NYMEX. And it settled at $2.677 per million BTUs (MMBtu). Once again, warm weather is the main factor cited for the low price. Here's a question: How did we go from almost $10/MMBtu gas and one of the tightest, most volatile markets in over a decade, to sub-$3/MMBtu gas and one of the most bearish scenarios seen in a long time--all in the span of just six months? We have some answers below.

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