Natural gas (NG=F) futures have soared, picking up more than 75% over the past five trading sessions to mark the largest five-day gain since at least 1990.
The energy product, trading around $3 per million British thermal unit (MMBtu) at the start of the week, is now changing hands at over $5 per MMBtu.
Weather forecasts are showing a major cold snap set to hit a wide swath of the eastern seaboard this coming weekend, with low temperatures and heavy snow expected across an area stretching from New York City to Dallas.
Overall, the storm is expected to impact more than 150 million people, according to AccuWeather.
“We are anticipating a major winter weather event expected to impact much of the US population this weekend, especially the Midwest and East Coast,” Kristi Noem, secretary of the Department of Homeland Security, said in an X post. “Please prepare and take precautions in the event of power outages, pipe-bursts, road closures, airport delays, flight cancellations, and freezing temperatures.”
Natural gas is the most common source for heating through the US, responsible for fueling 47% of heating demand, according to the Energy Information Administration. Gas also makes up a significant chunk of electrical generation power. Cold weather, like that predicted to hit New York City and the surrounding area, triggers natural gas demand as people turn on their heaters and backup generators in power outages.
Gas is also susceptible to quick pricing pressure because it can only reliably be moved around the country by pipeline, meaning extra supply cannot be quickly trucked in like oil. The data center boom is also putting increasing pressure on the market as Big Tech developers turn to gas for quick, cheap power, booking pipelines and further tightening supply.
Major US natural gas producers EQT Corporation (EQT) and Antero Resources Corporation (AR) both picked up steam in premarket trading on Thursday after rallies on Wednesday of 6% and 4%, respectively. Major pipeline operator The Williams Companies (WMB) traded down before the market open on Thursday after picking up 2.5% on Wednesday.