U.S. natural gas prices dropped below $3/mmbtu in early January 2026 due to warm weather, record production, and strong exports.

U.S. natural gas futures fell over 5% in early January 2026, hitting a multi-month low, as warmer weather forecasts reduced heating demand, particularly in the Northeast. Henry Hub spot prices dropped below $3 per million British thermal units for the first time in over two months, pressured by record production, strong LNG exports, and ample supply. A projected 107-billion-cubic-foot draw from inventories failed to offset weak demand fundamentals. Analysts cited ongoing bearish technical signals and global oversupply, including from LNG and pipeline flows, as key downward factors, despite colder conditions in Europe. LNG exports and shale output from the Haynesville and Permian basins are expected to drive most demand growth in 2026.