New York, Jan 23, 2026, 06:33 EST — Premarket
- February Henry Hub natural gas futures fell 6.1% overnight following Thursday’s surge
- A bigger-than-anticipated draw from U.S. storage coincided with an Arctic blast forecast that’s tightening supply.
- Next week’s power-demand peak and weather patterns are now the main near-term drivers
U.S. natural gas futures slipped in early Friday trade after rallying sharply over the past three days. The February contract fell 6.1% to $4.737 per million British thermal units (mmBtu) as of 2:41 a.m. EST, down from Thursday’s close at $5.045. 1
The pullback still leaves gas sharply higher for the week, with timing proving crucial. Traders juggle two factors: a rapidly intensifying cold snap that could disrupt both demand and supply, and uncertainty over how long the tight market will persist after the initial headlines fade.
The U.S. power grid faces a serious test as an Arctic blast drives freezing temperatures that are icing over wells and pipes, disrupting gas supplies across the Midwest and Great Plains. Natural gas futures jumped a record 63% in just three days through Thursday. The PJM Interconnection warned peak demand could top 130,000 MW for a full week next week. Philip Krein, an expert from the University of Illinois Urbana-Champaign, said, “That makes the grid more vulnerable.” 2
New government figures highlight just how fast demand is shifting. Working gas in storage was 3,065 billion cubic feet (Bcf) for the week ending Jan. 16, down 120 Bcf from the previous week, according to the U.S. Energy Information Administration. Still, inventories stayed above both last year’s levels and the five-year average. 3
Some desks are already flagging signs of exhaustion despite strong fundamentals. Heather Wine, senior risk manager for energy at StoneX, pointed out that “Volume over the past two days could indicate a ‘blow off’ top.” She also highlighted that the February contract hit a four-year high close to $5.578 and was testing crucial resistance just above $6.00. 4
Wine highlighted the risk of supply disruptions from “freeze-offs”—when freezing water and equipment halt production—and warned outages might exceed 10 Bcf a day in a worst-case scenario, leaving the market on edge through the weekend. 4
Beyond U.S. weather, the bigger story remains LNG. The International Energy Agency projects Europe will import a record 185 billion cubic metres of liquefied natural gas in 2026. Meanwhile, global LNG supply is set to rise by more than 7% this year. IEA’s Keisuke Sadamori described this “unfolding LNG wave” as likely to “pressure prices downward while improving market liquidity.” 5
Right now, the U.S. market is acting like a short fuse. Minor tweaks in temperature forecasts can rapidly shift heating demand, and confirmed reports of field freeze-offs tend to push prices up even before the data reflects the change.
The upside scenario isn’t straightforward. Storage remains healthy compared to typical levels for this stage of winter, and if temperatures warm sooner than anticipated — or production stays steadier than expected — the market could erase gains as quickly as it made them.
