Natural Gas Update January 8,2026

February 25, 2026

Natural Gas--NG is down 6.5 cents at $3.460
NG is lower now as the rally of the past 24 hours has petered out. As one colleague says "more is needed". The rally yesterday was seen due to a colder forecast, a bullish number expected for today's EIA gas storage data and some shortcovering. Some even suggest the lower gas production seen this month from last month is supporting prices.

Today's EIA natural gas storage data is seen as a draw of 114 to 120 BCF as per Reuters and WSJ surveys. This compares to last year's draw of 40 BCF and the 5 year average draw of 108 BCF.

Open interest for NG on the CME in Wednesday's activity shows an increase of nearly 10,000 contracts, even as February open interest fell by over 10,000 contracts. The February open interest drop (to us) supports the notion of shortcovering.

January U.S. natural gas production so far has averaged 109.0 BCF/d, down from December's record level of 109.7 BCF/d, as per LSEG data. On a daily basis, output was on track to drop to a three-week low of around 108.1 BCF/d on Wednesday due in part to declines in Arkansas and Texas, down from 108.5 BCF/d on Jan. 6 and a daily record high of 111.1 BCF/d on December 21, according to LSEG data.

Average gas flows to the eight large U.S. LNG export plants have risen to 18.6 BCF/d so far in January, up from a monthly record high of 18.5 BCF/d in December. (Reuters)

TTF European spot gas futures have gapped back down today --leaving yesterday's trading as an island top -for now. Support we had pegged at 26.9 Euros has almost been tested today with a low of 27.055. Momentum has turned back negative in the fall seen today. The move lower today comes even as storage data for European gas supplies has an overall bullish tone. European gas storage registered its largest daily withdrawal of the season Tuesday at -42 BCF/d (the 5 year average is a draw of 19 BCF/d). This pushed the storage deficit versus the 5 year average to a new multi-year high of -510 BCF. Storage is now 554 BCF below year ago level. Current European storage is 2.279 TCF; but, Celsius Energy is forecasting storage to fall below 1.0 TCF at withdrawal season's end. “The latest positioning data indicate that investment funds reduced their net short position in TTF for the third consecutive week,” ING analysts say. Over recent weeks, TTF has been limited in its upside price movement as the higher sourcing from LNG combined with steady sourcing from Norwegian pipelines has kept supply ample, some say. (Trading Economics)

Technically NG spot futures have filled the gap to 3.563 on the DC chart created over last weekend. The rally of yesterday and the overnight hours has seen momentum basis the DC chart turn positive. Resistance lies at the overnight high at 3.628-3.634.  The 200 day moving average on the DC chart lies at 3.554, that has been tested the past 2 sessions. There is currently a double bottom on the spot NG futures from yesterday/today at 3.419-3.420. Support below that lies at 3.355-3.357.

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