Low gas inventories, continued wartime uncertainty, and general commodities bullishness are causing upward pricing momentum. There appears to be no limit to how high prices could rise.

Long-term deals are more cost effective than short-term ones. Risk can be mitigated with a diversified buying strategy. Many facilities are avoiding supplier premiums by relying on index-heavy strategies.

Strong LNG demand, cooler weather, and geopolitical headlines have been bullish near-term drivers. Natural gas prices remain volatile with energy prices climbing due to the Ukrainian crisis.

If bearish weather holds and production rebounds as expected, pricing may decline as weather fades, supply gains, and a robust storage exit allows the market to look beyond the end of winter.

Bearish fundamentals have dominated winter thus far, dropping national prices to summer levels. Still, CA prices remain elevated, and changing weather patterns could provide support as heating begins to ramp up.

Robust production gains along with a slow start to winter heating demand have been bearish. Still, many winter weeks remain, and there is risk associated with a tightening supply/demand picture.

Recent natural gas price rallies may slow or possibly weaken for a brief period. Be ready to execute a short-term winter hedge quickly. Plan to reevaluate risk tolerance and procurement strategy in spring 2022.

Most fundamentals for natural gas pricing are bullish. There is little keeping natural gas bearish for the future unless massive increases in production and reduced electricity demand are realized.