El Nino to Send January Natural Gas Prices Soaring
Natural gas prices are expected to rise in January due to the potential impact of El Nino, according to recent analysis. The Henry Hub settled at $2.662 for September and $4.027 for January 2027. The analyst believes that January's price will reach $4.50 to $4.75 by October 31st.
The NOAA discussion in July put an 81% chance of a very strong El Nino across October to December, which the desk reads as fewer January cold shots. This could result in a weaker late winter polar vortex and more frequent major disruptions.
Natural gas prices fell throughout July, but the winter strip did not follow suit. As a result, January 2027 is carrying a $1.365 premium over the front of the curve, which most of the desk reads as stale insurance from last winter.