Natgas Prices in New England Spiked to Highest Ever in January
In January 2026, New England experienced record-high natural gas prices triggered by an intense cold snap. On January 27, wholesale electricity costs reached $441.8/MWh, a significant jump from the previous January’s average of $135.08/MWh. The problem is not enough natural gas pipelines. But that’s not what the dunderheads who run the blue states of New England believe. They think natgas is the problem and that more unreliable renewables are the solution. You can’t fix stupid, but you can vote it out of office. Read More “Natgas Prices in New England Spiked to Highest Ever in January”
A recent article by David Blackmon (writing for Forbes) argues that critics unfairly blame rising U.S. liquefied natural gas (LNG) exports for high domestic energy costs. While narratives suggest exports drain supply and spike prices, Blackmon highlights data showing that inflation-adjusted natural gas prices have trended lower or remained stable as the LNG industry has grown. He attributes regional price hikes not to exports but to infrastructure roadblocks (a lack of pipelines) in specific states. Furthermore, he contends that gas price volatility is a long-standing market characteristic unrelated to LNG. 
Hedging is the practice of locking in a price now to sell gas you will produce in the future. We’ve written a fair bit about hedging (
Natural gas markets are currently facing significant storage deficits for the first time in a year, following the severe disruptions caused by Winter Storm Fern. Record-breaking withdrawals, including a weekly high of 360 Bcf, have pushed inventories 130 Bcf *below* the five-year average due to spiked heating demand and production freeze-offs. This supply-demand imbalance triggered a 300% surge in Henry Hub prices, which peaked at nearly $14.00. However, as production recovers and forecasts predict warmer late-February temperatures, analysts expect market volatility to stabilize and cash prices to gradually converge with front-month contracts as supply concerns ease. 
The U.S. Energy Information Administration (EIA) issued its latest monthly Short-Term Energy Outlook (STEO) yesterday. The STEO is the agency’s monthly best estimate of where energy prices and production will head over the next 12 months. There was a major revision to the agency’s prediction about the spot price (at the Henry Hub) for natural gas in 2026. Just last month, EIA predicted the HH spot price would average $3.46 per million British thermal units (see 
Natural gas futures suffered a historic 26% collapse—the steepest one-day percentage drop since 1995 (over 30 years!)—as the most-active “front month” contract plunged over a dollar to close at $3.237/MMBtu. This dramatic retreat was fueled by forecasts of “well above normal” temperatures across the Eastern U.S. and a recovery in production following recent freeze-offs, both of which point toward a looming inventory buildup. Although analysts at NatGasWeather.com suggest the market may have overshot the actual data, the combination of a thawing climate and stabilizing supply clearly spooked investors enough to trigger this record-breaking slide. 
Yesterday, the NYMEX natural gas March futures contract became the “front month” contract after the previous February contract expired. As we reported, the February contract went into the stratosphere, closing at $7.46/MMBtu based on something called a short squeeze (see 
A pretty unique situation is happening with the price of natural gas, both the NYMEX futures price and the spot (cash) price. Yesterday was the last day for the NYMEX February contract as the “front month.” The price, already high, rose further, adding 50.6 cents from the previous day to close at $7.46 per million British thermal units (MMBtu). It is the highest settlement value since Wednesday, Sept. 21, 2022. However, yesterday the physical spot (cash) price for natural gas crashed back down to earth. The benchmark Henry Hub lost about 75% of its value yesterday. Today, the March NYMEX contract becomes the “front month.” As of this morning, the March contract is trading around $3.80/MMBtu. The reason the NYMEX soared again yesterday was a short squeeze. 
Yesterday, the natural gas price rocketship continued its flight into the stratosphere. U.S. natural gas futures soared Monday, with the front-month contract surging to a three-year high, closing at $6.80/MMBtu, as winter storm Fern swept across the country, driving up heating demand and threatening supply. Spot prices are literally through the roof, spiking to levels we’ve not seen in years. The deep freeze continues through the eastern half of the country at least until Feb. 9, according to NOAA’s temperature outlook. However, there are signs that a “sharp collapse” may soon unfold. 
As we predicted may happen in a post yesterday, the NYMEX “front month” natural gas futures price closed above $5 yesterday (see 
Old Man Winter has proven once again that he is the one in charge of natural gas prices. A cold blast now entering the Midwest and Northeast, which is moving in until early February (at least), is the reason for a dramatic jump in the NYMEX front-month futures contract price, rising 80.4 cents per MMBtu (26%) in one day, yesterday, to a closing price of $3.9070 MMBtu. It is the largest one-day percentage gain in four years, since January 2022. The price continued climbing this morning (Wednesday) and looks like it might flirt with $5.00! 