In an EBW Analytics Group report despatched to Rigzone by the EBW group on Tuesday, Eli Rubin, an power analyst on the firm, highlighted that Henry Hub spot fuel costs “collapse[d] to $2.86 per MMBtu [million British thermal units]” on Monday.
“Bodily pure fuel costs are crashing, with Henry Hub spot costs buying and selling at a mere $2.86 per MMBtu yesterday,” Rubin acknowledged within the report.
“Final month, December 2025 averaged $4.13 per MMBtu – and yesterday’s $2.86 common sits 45 cents (-14 p.c) beneath even subdued bodily pricing over an awfully gentle Christmas vacation,” he added.
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“Regionally, whereas prolonged chilly within the Northeast has Algonquin Metropolis Gates at $9.91 per MMBtu, costs have fallen aside to simply $2.02 per MMBtu within the Rockies. Houston Ship Channel traded at $1.78 per MMBtu – nearing ranges typically related to price-induced shut-ins in the course of the decrease demand shoulder season,” Rubin warned.
“Every day demand is predicted to common 2.3 Bcfpd [billion cubic feet per day] decrease on Wednesday-Friday than throughout right now’s session, implying continued strain on spot costs more likely to bleed into the NYMEX futures market,” he continued.
Within the report, Rubin famous that the NYMEX front-month contract “examined as low at $3.355 [per MMBtu] yesterday earlier than discovering assist and rallying 17 cents into the shut”.
“Whereas technicals tried to fill the hole down on the open, nevertheless, the near-term outlook (i) continues to bleed heating demand and (ii) could also be weighed down by Henry Hub spot market collapse to $2.86 per MMBtu,” he added.
The EBW report highlighted that the February pure fuel contract closed at $3.523 per MMBtu on Monday. It outlined that this was a 9.5 cent, or 2.6 p.c drop, from Friday’s shut.
Within the report, Rubin mentioned “climate pushed demand will weaken additional into Friday’s report heat”, including that “subsequent week’s nationwide gHDD whole could approximate Week 1”.
“Ultimately, a colder again half of January stays on faucet – however even that will do little to offset blowtorch early-month heat eviscerating January gHDDs to the third warmest since 2017,” he added.
In Tuesday’s report, EBW predicted a “take a look at decrease and rebound” development for the NYMEX front-month pure fuel contract value over the subsequent 7-10 days and an “upside chilly dependent” development over the subsequent 30-45 days.
In a separate report despatched to Rigzone by the EBW group on Monday, Rubin outlined that “gentle climate forecasts” had been “refashion[ing] [the] January pure fuel outlook”.
“Climate forecasts continued to soften down over the weekend, sending pure fuel hurtling decrease. Whereas January is barely 100 hours outdated, DTN’s forecast has already shed 55 gHDDs and 85 Bcf [billion cubic feet],” Rubin mentioned in that report.
“Different broadly adopted meteorologists predict even bigger gHDD losses,” he acknowledged.
In that report, Rubin warned that “day by day demand could lose one other 9 Bcfpd into Friday’s report heat” and added that “climate has amplified bearish technicals with dangers of the February contract falling to $3.25”.
Rubin went on to state in that report that “climate normalized fundamentals are stout”, noting that “weekly common manufacturing readings stumbled two Bcfpd to open 2026, nearly erasing provide good points since Thanksgiving”.
“Weekly LNG feedgas reached a report 19.9 Bcfpd. Each provide a level of basic assist,” he mentioned.
“In the midst of winter, nevertheless, climate stays king. Possibilities for a sharply colder again half of January may nonetheless spark upside, and greater than half of winter stays forward,” Rubin identified.
“If forecasts can not arrest gHDD declines, nevertheless, bulls will run out of time earlier than the March contract turns into the NYMEX front-month in simply three weeks,” Rubin warned.
EBW highlighted in Monday’s report that the February pure fuel contract closed at $3.618 per MMBtu on Friday. This was down 6.8 cents, or 1.8 p.c, from Thursday’s shut, the report outlined.
In Monday’s report, EBW predicted a “unstable sample continues” development for the NYMEX front-month pure fuel contract value over the subsequent 7-10 days and an “upside chilly dependent” development over the subsequent 30-45 days.
To contact the writer, e-mail andreas.exarheas@rigzone.com
