Natural Gas Price Forecast - NG=F Around $3 As US Surplus Clashes With Europe’s TTF Weather Spike

Natural Gas (NG=F) Winter Repricing And What The Curve Is Really Saying

Natural Gas (NG=F) Price Action Around $3 And The Front-End Curve

Front-month Natural Gas (NG=F) trades near $3.09/MMBtu after February 2026 NYMEX briefly washed out to a three-month low and then bounced on a colder forecast window. The front has slipped from roughly $3.50–$3.60/MMBtu down to the low $3s, and the 12-month strip sits only around $3.30–$3.35/MMBtu, which tells you the weakness is not just a front-month event but spread across the next year.
That profile is consistent with what US forwards are pricing: across the Jan 8–14 period, February fixed prices fell almost everywhere, with eastern and West Coast hubs leading the decline while Henry Hub itself stayed locked in grind-lower mode and only caught a short-covering bounce once weather models flipped colder.

Storage Surplus, EIA Draws And Why Natural Gas Still Trades Heavy

The core reason Natural Gas cannot break higher is simple: inventories are too comfortable. The latest EIA data showed a 71 bcf withdrawal for the week ending 9 January, versus expectations near 91 bcf and a five-year average pull of about 146 bcf for this point in winter.
After that weak draw, US storage still stands roughly 2.2% above last year and about 3.4% above the five-year seasonal norm, so the system is not being stressed by this winter at all.
With that backdrop, every weather-driven rally in NG=F is fighting a visible surplus and a market that has no incentive to price scarcity unless forecasts turn extreme and stay extreme.

Production, Demand And LNG Flows Behind The Natural Gas Balance Sheet

On the flow side, lower-48 dry gas production runs near 112 bcf/d, up almost 8% year-on-year, while total lower-48 demand sits around 114 bcf/d – a small storage draw, but hardly a panic.
The EIA has already cut its 2026 dry-gas production outlook from about 109.1 bcf/d to 107.4 bcf/d, but even that “reduced” forecast still leaves supply at a historically high level, easily covering domestic burn plus LNG exports and cross-border flows into Mexico.
Short term, Natural Gas is also weighed down by LNG issues: feedgas into Cheniere’s Corpus Christi and the Freeport terminal along the Texas Gulf Coast has been running below normal this week due to electrical and piping constraints, leaving more molecules stuck inside the US system instead of being pulled offshore.

Power Burn, Industrial Demand And The Limits Of Weather Support For NG=F

The Edison Electric Institute’s latest reading showed lower-48 electricity output down more than 13% year-on-year for the recent week, even though the trailing 52-week output is still up 2.5%.
That matters because power is the main swing demand for Natural Gas: if overall generation is down and renewables are taking a larger slice of the stack, you need much harsher, longer cold spells to generate the same incremental gas burn you saw ten years ago.
The structural shift is clear in the longer-term data. Two decades ago, US Henry Hub prices in 2005 averaged about $13.70/MMBtu in 2024 dollars, and the EIA expected something like $9.30/MMBtu as a long-run range for 2016–2025. Actual realized prices came in closer to $3.60/MMBtu and hit a real-terms low around $2.19 in 2024, because shale output and efficiency crushed the old scarcity regime.
Cheap gas has taken power-sector share and displaced coal, but at the cost of turning NG=F into a commodity that needs either extreme weather or major infrastructure shocks to sustain rallies.

European TTF, UK Hub And Why The Real Weather Premium Is Offshore

While Henry Hub is trapped, Europe’s Dutch TTF benchmark has ripped higher. TTF jumped about 10.5% on Friday to roughly €36.7/MWh, putting the contract nearly 30% higher on the week as traders priced in a late-month Arctic blast across the continent.
Storage withdrawals have accelerated; European inventories now sit just under 52% full compared with a five-year average closer to 67% at this stage of winter, a meaningful gap that feeds directly into a weather premium.
The UK hub is seeing the same pattern. Day-ahead prices and February delivery are trading near six-month highs, with February above 98p/therm after wholesale gas rallied roughly 40% this month on the combination of cold weather, weaker LNG imports and lower storage. Gas-fired power still supplied about 36% of UK demand on a recent day and surged above 50% during the last cold snap, underscoring how temperature shocks still hit Europe’s balances hard.

Short Covering, Spec Positioning And Volatility In European Gas Versus NG=F

The move in Europe is not just weather, it is positioning. Funds had built large net short exposures in TTF through the early part of winter, betting on mild conditions and comfortable inventories. Analysts now estimate that net shorts have already been cut from about 92.8 TWh in mid-December to 55.1 TWh, a sign that the current squeeze is driven by forced buying on top of genuine demand for protection.
In that environment, every forecast revision colder and every headline about Iranian flows to Turkey or Asian LNG demand becomes a catalyst for violent upside. Natural Gas (NG=F) does not have the same structural short overhang right now, and it has a storage surplus instead of a deficit, so the same weather impulse produces a much shallower response at Henry Hub.

LNG Wave 2026–2027 And The Medium-Term Ceiling Above Natural Gas

The medium-term cap for NG=F is the global LNG buildout. Citigroup, for example, expects TTF prices for 2027 to come under sustained downward pressure as a structural oversupply of LNG emerges with new liquefaction capacity hitting the water, especially from the US and Qatar.
That view is consistent with the American Gas Association’s long-run data: US dry gas production is expected to exceed 39 Tcf in 2025, roughly double what was projected twenty years ago, and reserves continue to rise as technology improves.
When you combine that supply profile with the US already being the world’s largest LNG exporter, it is clear the system is moving toward persistent abundance rather than a new scarcity phase. Weather will still generate spikes, and geopolitics will still matter, but the default state for Natural Gas is now “cheap and available” unless something breaks.

North American Forwards, Basis And What They Imply For NG=F

Forward curves across North America support a capped-upside story for NG=F. NGI data for the Jan 8–14 window show February forwards falling broadly, with eastern and West Coast hubs leading the move lower even as some Permian basis locations quietly firm from very steep discounts.
Permian points still price several dollars under Henry Hub because of takeaway constraints, but the shape of those curves – steep discounts near term, and only partial normalization into 2027 – underlines how much physical oversupply is embedded in the system.
On the supply side, Baker Hughes’ latest count shows US gas-directed rigs at 124, only modestly below the recent 2¼-year high of 130 reached at the end of November 2025.
Producers have trimmed growth at the margin, not slammed on the brakes, which means the market gets some relief but not enough to engineer a tightness regime without help from demand.

Macro, Dollar And Cross-Asset Pressure On Natural Gas (NG=F)

Macro conditions are not doing NG=F any favors. Stronger US data have forced traders to reduce the number and speed of expected Fed cuts, supporting the dollar and pressuring high-beta assets, including commodities with visible surpluses like natural gas.
In that environment, any rally driven purely by a two-week cold window gets sold into unless it is backed by genuinely bullish storage prints or a structural export surprise. Right now, the EIA data say the opposite: inventories are above average, draws are soft and export feedgas is temporarily constrained.

Key Trading Levels For Natural Gas (NG=F) And TTF

Technically, Natural Gas (NG=F) is boxed into a clear range. On the downside, the recent three-month low just under $3.00/MMBtu is the first line of support; if storage remains 3–4% above the five-year average and the late-January cold shot under-delivers, there is room for a test into the high-$2s.
On the upside, the $3.50–$3.60/MMBtu band where February traded before the last EIA miss and forward-curve slide is the first serious resistance. To clear that area and hold above, the market needs either a sequence of above-normal draws or a clear return to full LNG utilization that tightens balances in a measurable way.
For TTF, the move to around €36–€37/MWh puts the contract well above the €30/MWh range that dominated late 2025; €30 now acts as support, and any extension of the Arctic pattern can justify a spike toward €40/MWh. But with a large LNG wave due in 2026–2027 and banks like Citi already leaning bearish on that horizon, the curve is unlikely to treat this winter rally as a structural reset.

Verdict On Natural Gas (NG=F): Hold, With Tactical Long Opportunities Rather Than A Structural Bull Call

Combine all the moving parts – NG=F around $3.09/MMBtu, US storage 3–4% above the five-year norm, European inventories closer to 52% versus a 67% average, a short-covering spike in TTF, and a heavy LNG supply pipeline for 2026–2027 – and the conclusion is straightforward.
Near term, the set-up is mildly constructive: a genuinely cold late-January pattern in Europe, plus any upside surprise in US withdrawals, can justify tactical long exposure off the $3 area, especially if LNG feedgas recovers from current constraints. Medium term, the structural story – record US production, decades-low real prices, rising reserves and new LNG capacity – still argues firmly against chasing Natural Gas as a multi-year bull market theme.
On that basis, Natural Gas (NG=F) is a Hold with a tactical long bias on dips toward the high-$2s and early-$3s, not a conviction long to accumulate at any price. The risk-reward improves temporarily when weather and European stress line up, but once those catalysts pass, the market goes back to trading an abundant fuel with a clear global supply wave on the horizon.

That's TradingNEWS