What is currently driving U.S. Natural Gas prices?

Prices are primarily driven by short-term weather forecast revisions and the steady demand for international LNG exports, which provides a price floor.

How do LNG exports affect the Henry Hub price?

Strong global demand and overseas pricing keep export utilization high, maintaining consistent feedgas demand in the U.S. domestic market.

Why is the New York morning session critical for gas trading?

The NY morning session is when the market most aggressively reprices based on the latest 10–15 day weather forecast updates.

US Natural Gas Analysis: Weather & LNG Floor Jan 2026

Natural gas markets face a high-volatility regime as winter weather forecasts and LNG feedgas demand dictate Henry Hub price action.

The U.S. natural gas market enters the January 21 session firmly entrenched in a volatility-led regime, where short-term weather revisions dictate the pace and LNG export demand establishes the structural floor. Amid a broader macro environment characterized by elevated policy uncertainty, Henry Hub remains uniquely sensitive to micro-fundamental shifts rather than just global risk appetite.

The Multi-Session Perspective: Weather Revisions Drive Flow

As we transition from the Asia close into the London open, the global gas tone remains influential via the liquefied natural gas (LNG) channel. Strong overseas pricing continues to incentivize high export utilization, which maintains a steady pull on U.S. feedgas demand. However, the true directional impetus typically materializes during the New York morning.

Session-Specific Anchors

London Morning: European gas benchmarks (TTF) influence the narrative, though Henry Hub primarily reprices based on updated U.S. weather runs. Traders should avoid overreacting to macro headlines unless they significantly alter LNG flow expectations.
NY Open & Morning: This is the critical window for price discovery. The market aggressively reprices the next 10–15 day forecast window, with storage data providing secondary validation later in the week.

Market Scenarios and Risk Distribution

The current risk distribution suggests that while the base case (60% probability) favors a choppy range driven by forecast swings, the "tails" of the distribution remain fat. This implies that even minor shifts in perceived weather disruptions can trigger outsized moves in natural gas futures.

Identifying Confirmation Channels

For traders navigating this sequence, directional spot moves are only as durable as their underlying confirmation channels. A spot rally without tightening prompt spreads is often fragile. Conversely, spot gains coupled with firmer prompt spreads suggest a durable physical bid. Key metrics to monitor include:

Implied Volatility: Are vols rising faster than spot prices? This indicates a surge in hedging demand.
Prompt Spreads: Tighter spreads validate physical tightness in the system.
Flow Validation: Does the price move survive the liquidity transition from London to New York?

Technical Discipline and Microstructure

In a headline-driven regime, the market frequently exhibits "false precision" during early trading. Asia and London may set a direction on thinner liquidity, but the New York session acts as the final arbiter of trend durability. Execution strategies should prioritize conservative sizing and staggered entries, treating technical levels as points of invalidation rather than fixed targets.

Ultimately, trading Henry Hub in the current environment requires respecting the contract's inherent convexity and the potential for rapid mean reversion if weather models shift unexpectedly.