New York, February 2, 2026, 10:31 (EST) — Regular session
- March Henry Hub natural gas futures dropped almost 19%, settling near $3.55 per mmBtu
- United States Natural Gas Fund plunges roughly 19%, dragged down as gas-related stocks fall alongside futures
- Traders are eyeing shifting U.S. weather models alongside Thursday’s storage report for their next signal
U.S. natural gas futures dropped almost 19% on Monday, erasing gains fueled by weather forecasts and pulling down gas-related funds and producer stocks in early trading. The March contract, the most active, fell 80.7 cents to $3.547 per million British thermal units (mmBtu), the standard measure for gas trading. (CME Group)
This move is significant given the market’s recent jolts from winter swings, with gas playing a key role in household heating and a large portion of U.S. power generation. A sharp decline like this usually sends shockwaves through producer cash-flow forecasts and short-term hedging strategies.
The timing is tricky. Traders are weighing if the recent cold snap drained storage enough to squeeze late-winter supply, or if a sudden warm-up will push the market back into surplus.
Bloomberg cited a National Oceanic and Atmospheric Administration outlook predicting warmer-than-usual weather later this month, despite lingering winter chill in the short term. Earlier this month, U.S. gas prices spiked 117% over five days amid a cold snap that drove up heating demand and cut production. ING analysts said deliveries to liquefied natural gas (LNG) plants dropped by as much as 48% last week. (Investing)
During early Asian sessions, the front-month contract dropped by up to 17% to $3.620 per mmBtu, wiping out the 11% rise seen on Friday, Bloomberg reported. (Bloomberg)
LNG continues to be the go-to for traders watching demand as exports climb. Shell CEO Wael Sawan noted the sector is growing roughly 3% annually, faster than the overall gas market. (Reuters)
U.S. equities took a hit as United States Natural Gas Fund dropped roughly 18.6%. Gas-centric stocks also slipped: EQT Corporation declined around 4.1%, Antero Resources lost about 5.1%, and both LNG exporter Cheniere Energy and pipeline operator The Williams Companies dipped close to 1% each.
Deal news shook up the tape again. Devon Energy and Coterra Energy struck a $58 billion all-stock merger, according to Reuters. Gabriele Sorbara of Siebert Williams Shank & Co described it as “incrementally positive for both shareholders” amid today’s “volatile energy tape.” (Reuters)
Natural gas moved lower amid a wider risk-off mood in commodities following Donald Trump’s announcement of Kevin Warsh as the new Federal Reserve chair, which boosted the dollar and weighed on commodity prices, Reuters reported. Vivek Dhar from Commonwealth Bank of Australia called it a “correction,” while Tony Sycamore at IG flagged forced position unwinds. (Reuters)
Weather remains a wildcard. A fresh wave of below-normal temperatures or new freeze-offs limiting output could slam balances tight fast, while unexpected LNG plant outages can jolt demand without warning.
The U.S. Energy Information Administration’s weekly storage report is set for Thursday, Feb. 5 at 10:30 a.m. ET, alongside fresh weather-model updates. If storage draws come in larger than expected, prices could firm back up. But a smaller draw would probably deepen today’s selloff. (EIA Information Releases)
