NEW YORK, December 31, 2025, 13:37 ET — Regular session
- U.S. natural gas futures are down nearly 7% midday, pressured by warmer early-January forecasts.
- EIA storage data showed a smaller-than-expected withdrawal, reinforcing near-term demand concerns.
- Natural gas-linked ETFs and producers are lower, tracking the commodity’s move.
U.S. natural gas futures slid nearly 7% on Wednesday, pulling the benchmark contract down to around $3.70 per million British thermal units (mmBtu) in the middle of the New York trading day. The front month traded between $3.689 and $3.982.
The drop comes at a sensitive moment for the market. Winter demand can shift quickly, and traders have been reacting sharply to changes in short-term temperature forecasts as the calendar turns to January.
Fresh storage data added to the bearish tone. The Energy Information Administration reported a 38 billion cubic feet (Bcf) withdrawal for the week ended Dec. 26, smaller than the 51 Bcf draw the market was looking for, with the prior week showing a 166 Bcf withdrawal.
Forecasts were a central driver of the move. Meteorologists projected above-normal temperatures nationwide through Jan. 14, with heating degree days — a measure of how much energy is needed to heat buildings — falling from 439 to 413, a Reuters report said. The same report said LSEG pegged total lower-48 demand, including exports, easing from 137.8 billion cubic feet a day this week to 134.5 bcfd next week, while production averaged a record 110.1 bcfd in December and flows to LNG export plants remained near record levels. Energy Ventures Analysis president Robert DiDona said the market is approaching “the next wave of the LNG boom.” World Energy News
LNG “feedgas” refers to pipeline gas delivered to liquefied natural gas export terminals, a key demand source that can tighten the U.S. balance when flows rise.
In U.S. stocks, the United States Natural Gas Fund (UNG) — an exchange-traded fund designed to track Henry Hub futures — fell 6.5% to $12.27. Leveraged natural-gas funds moved more: ProShares Ultra Bloomberg Natural Gas (BOIL) sank 11.8%, while ProShares UltraShort Bloomberg Natural Gas (KOLD) rose 11.8%.
Gas-heavy producers were weaker alongside the commodity. EQT fell 2.5%, while Antero Resources and Range Resources slid 2.7% and 3.0%, respectively; LNG exporter Cheniere was little changed.
Pipeline operators, which tend to earn fee-based revenue on volumes moved rather than spot prices, were steadier: Williams slipped 0.2% and Kinder Morgan fell 0.5%.
Traders are now focused on whether the next set of weather-model updates reintroduces colder risks in mid-January. The path of demand matters because heating load typically dominates winter price direction once holiday-week demand patterns fade.
Investors are also watching LNG terminal utilization and daily feedgas flows, along with any signs that record production is holding above 110 bcfd. A run of smaller storage withdrawals would point to a looser balance; bigger pulls would quickly tighten it.
For 2026, the EIA’s short-term outlook expects U.S. dry gas production to average about 109 Bcf/d and LNG exports to rise, while projecting Henry Hub pricing above 2025 levels in its annual averages.
That longer-dated backdrop has kept the forward curve supported even as day-to-day volatility returns. For now, the market is trading the next weather map and the next storage print — and natural gas stocks are moving with it.
