Overview
- The February NYMEX contract jumped about 29% to $6.80 per mmBTU, briefly touching roughly $7.44, capping a five‑day surge of about 119%.
- U.S. production fell to a two‑year low as wells in Texas and Louisiana froze, with analysts pointing to methanhydrate “freeze‑offs” that clog valves and pipelines.
- Traders rushing to cover sizable short positions before Tuesday’s expiry amplified the rally, with market data showing heavy speculative bets being unwound.
- European markets are on alert because lower regional storage around 46% and a reliance on U.S. LNG raise the risk of price pressure, with TTF lifting above €40/MWh to attract cargoes.
- Domestic buffers could curb the spike’s duration as EIA inventories sit about 6.1% above the five‑year average, while estimates indicate a nascent output rebound in the Permian Basin.