New York, Jan 27, 2026, 06:29 EST — Premarket
- NYMEX February natural gas dropped roughly 5% in early trading, retreating from Monday’s spike
- Traders are focusing on freeze-offs, LNG feedgas, and the February contract expiration set for Jan. 28
- The curve stays sharply inverted, with March trading well under the front month
U.S. Henry Hub natural gas futures for February fell 33.5 cents, or nearly 4.9%, to $6.465 per million British thermal units (mmBtu) early Tuesday. The contract cooled off following a 52-week peak at $7.439 hit in the previous session. According to CME calendar data, the February contract is set to expire on Jan. 28. 1
The pullback is significant since the front month now serves as a real-time test of how quickly U.S. supply bounces back after weekend freeze-offs — when wells and field gear freeze up, cutting flows — even as heating demand remains high in some regions. The market reacts to new weather forecasts and pipeline buzz, not tidy end-of-day stories.
The wide gap between contract months is drawing attention. While February prices jumped into the $6 and $7 range, the March contract stuck near the high-$3 level. Analysts link this shape to short-covering and believe the supply squeeze is mostly front-loaded. Some even highlight that summer 2026 gas remains under $4. 2
Financial firm LSEG reported Lower 48 output dropped to 92.6 billion cubic feet per day (bcfd) on Sunday, hitting a two-year low, before climbing slightly. Production is “on track” to reach around 95.5 bcfd on Monday. The firm also projected that average demand, including exports, would decline next week after staying elevated this week. LNG feedgas volumes fell to a one-year low of 12.1 bcfd on Sunday as flows slowed across plants. On the cash side, next-day gas prices surged to record or multi-year highs at several hubs, including the Henry Hub benchmark in Louisiana. 3
Colder weather, weaker production, and shaky LNG flows have combined to turn a typical winter staple into a volatile mess. Traders also highlight thin liquidity in the prompt contract, where even a minor imbalance can send prices swinging quickly.
Storm damage hit more than just gas fields. Rystad Energy pegged peak natural gas production losses from the freeze at roughly 20 bcfd. Operators flagged related problems with processing and compressors as well. “We closely monitor severe weather conditions,” an ExxonMobil spokesperson said. 4
The downside risk to prices is clear: if freeze-offs reverse rapidly and forecasts weaken, the front month could drop sharply — particularly since the market is already betting on a much milder March.
Traders are now zeroing in on daily output estimates, LNG feedgas nominations, and whether cash prices at major hubs ease as pipelines and processing plants restart. Another crucial figure is Thursday’s U.S. storage report, which will reveal how much gas was pulled from the ground and burned in furnaces and power plants during the cold snap.
The spotlight is on the February contract now. With expiry set for Wednesday, traders brace for sharp shifts as positions roll over and the market figures out how much of the storm premium should stay priced into the prompt month.
