US natural gas futures surged Monday morning as weather models continued to show a significant cold blast set to sweep across the Lower 48 in the coming days. The arctic air mass is expected to linger for weeks in the eastern half of the US, with increasing chances of wintery precipitation in some parts of the US. Traders appear to be responding to updated heating degree day forecasts, signaling a massive spike in heating demand over the next few weeks.
In early Monday trading, NatGas futures for February delivery surged as much as 12.3% to $3.80 per million British thermal units (MMBtu). Technicians note that prices have broken through the critical $3 resistance level this heating season after a multi-year bottom following the spike to nearly $10 in mid-2022.
On Friday, private weather forecaster BAMWX told clients "all systems go" for an Arctic blast, or "polar vortex," to pour into the eastern half of the US during the second week of January or by mid-month.
By Sunday, BAMWX meteorologists noted, "Now we're starting to think about historic cold."
"It's an intense level of cold in the heart of Winter," BAMX said.
BAMWX meteorologist outlines what's ahead:
- Cold arrives Jan 1
- Extreme cold comes w/storm ~7th
- Dangerous cold 8-12th
- Bigger storm mid month
- Pattern changes late Jan
Old Man Winter is inbound.