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Arctic Cold Snap Could Push U.S. Natural Gas Prices Higher

Forecasts of frigid temperatures later this month sent U.S. natural gas prices surging in the middle of last week to above $4.85 per million British thermal units (MMBtu)—the highest level since November. 

If the cold snap expected over the next two weeks holds and forecasts for additional Arctic blasts this winter materialize, natural gas at the Henry Hub could surge to above $6/MMBtu again, in a pattern similar to the one from the winter of 2014, when the polar vortex drove demand high and pushed up prices, analysts say.   U.S. natural gas prices were on a rollercoaster ride last week, surging by 14 percent on Wednesday to a six-week high, due to cold weather, before retreating by 12 percent on the following day “on the prospect for weather turning milder and after the weekly stock draw was in line with expectations,” said Ole Hansen, Head of Commodity Strategy at Saxo Bank.

“Adding to this was the recent surge in LNG shipments to Europe and the once-insulated US market has become much more exposed to international developments, all of which supported the biggest weekly rise since November,” Hansen added. 

Rollercoaster could be the key word for U.S. natural gas prices for the rest of the winter as market sentiment, and traders’ moves will likely depend on weather patterns and forecasts. 

In the short term, over the next two weeks, a cold snap is expected to sweep across a large part of the United States, bringing increased demand for space heating and power generation and pushing prices higher. 

“[F]rigid Arctic air will advance into the northern and eastern US late next week w/lows of -20s to 20s for very strong demand,” forecast at the end of last week. 

The weather forecasts by the end of January not only suggest still frigid conditions in many areas, but also include “a couple of the most impressive Arctic blasts so far this winter,” according to Satendra Singh at

If we see more Arctic blasts and a repeat or near-repeat of the 2014 polar vortex winter, natural gas prices could test the $6.526/ MMBtu mark once again, the analyst said. 

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Moreover, freezing temperatures could lead to production interruptions at some wells, other analysts note. 

“The possibility of late-month freeze-offs remains a crucial wild card,” Eli Rubin, senior analyst at EBW Analytics Group, told Natural Gas Intelligence on Friday.

“The cooling in the January weather forecast over the past three weeks, particularly for the last third of the month, has led to the coldest outlook since the 2014 Polar Vortex,” Rubin added. 

U.S. natural gas prices are set for rollercoaster volatility this winter, depending on how cold and how long the colder-than-normal snaps will be. Yet, average 2022 prices are expected to be slightly lower compared to last year’s average, according to the Energy Information Administration (EIA). 

Last year, the natural gas spot price at Henry Hub averaged $3.91/MMBtu, with a monthly average high of $5.51/MMBtu in October, the EIA said in its latest Short-Term Energy Outlook (STEO) in January.

This year, EIA sees Henry Hub spot prices averaging $3.82/MMBtu in the first quarter and $3.79/MMBtu for all of 2022, on the back of higher production—set to reach a record-high 96.0 Bcf/d—and relatively unchanged domestic consumption. The record output and flat domestic demand will continue to support the growth in U.S. natural gas exports that will increase to records this year and next, the administration says. 

Further growth to another record U.S. dry natural gas production of 97.6 Bcf/d in 2023 is set to result in $3.63/MMBtu average price next year, lower than this year’s expected average, the EIA notes.

By Tsvetana Paraskova for

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Tsvetana Paraskova

Tsvetana is a writer for with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.  More