Natural Gas News: Weather Models May Reset the Tone as Futures Look for Direction Today

Natural Gas Steadies After Testing Fresh Highs — Weather Still Calling the Shots

Natural gas is treading water Tuesday after an aggressive push that carried prices through the $4.593 resistance and up to $4.984 — a nearly three-year high on the nearest futures. The rally has legs, but traders are catching their breath. And with weather models still in flux, the next move isn’t guaranteed.

Monday’s strength came on the back of colder forecasts for early December, particularly across the eastern two-thirds of the country. Atmospheric G2 flagged a shift colder for December 6-10, with even frostier readings expected in the East through mid-month. That was enough to keep buyers in control.

At 15:49 GMT, January Natural Gas Futures are trading $4.898, down $0.023 or -0.47%.

Frosty Start, Foggy Finish

The near-term weather setup looks supportive. Frosty systems are tracking across the northern and central U.S. through early December, with highs in the 10s-30s and lows dipping below zero in spots. That’s strong heating demand territory.

But the picture gets murkier after that. Weekend model runs came in mixed — some trending colder, others warmer — and the 7-15 day outlook is still up for grabs. Expect big swings in both forecasts and price action as traders try to read the tea leaves. Weather patterns come and go. The market knows it.

Supply Isn’t Going Away

Production remains a weight in the background. Lower-48 dry gas output hit 111.8 bcf/day Monday, up nearly 7% year-over-year. Rig counts are climbing too — Baker Hughes reported 130 active gas rigs last week, a 2.25-year high. And the EIA recently bumped its 2025 production forecast to 107.67 bcf/day. That’s a lot of supply waiting to cap any rally that loses momentum.

Storage, meanwhile, sits 4.2% above the five-year seasonal average. Not tight. Not loose. Just adequate. Europe’s a different story — gas storage there is running at 76% versus an 86% five-year norm — but for now, U.S. inventories aren’t flashing any warning signs.

Levels to Watch

Holding above $4.593 keeps buyers in the driver’s seat. A fresh session high opens the door to $5.341, but that move likely needs a new catalyst — another cold surprise in the models, or a bigger-than-expected storage draw.

On the downside, a failure to hold above $4.593 would invite sellers back in. If that move gains traction, look for a pullback toward the 200-day moving average at $4.732 — the key support level and trend indicator.

Bottom Line

The bulls are still in control, but conviction is fading a little. Without a fresh jolt from the weather data, this market may need to consolidate before making its next real push.

More Information in our Economic Calendar.