Natural Gas Market Update – December 15, 2025

Tony Zelinski
Dec 15, 2025
2 min read

Natural gas futures retreated sharply on December 15, 2025, as colder forecasts failed to sustain last week’s rally. The market is recalibrating around technical support and shifting weather expectations.

🧊 Price Action and Technical Setup

Natural gas futures pulled back from recent highs, with the January contract falling 11.8 cents to $4.113/MMBtu on Friday. This marks a notable correction from the early December peak near $5.265/MMBtu, as traders reassess bullish momentum. The market is now testing a key technical zone around $4.068, which aligns with the 50% Fibonacci retracement level from the fall rally

Indicators suggest the correction may be nearing exhaustion:

Stochastic oscillator is deeply oversold, hinting at a potential bounce.
RSI remains in bearish territory but has room to climb.
100-day SMA is still above the 200-day SMA, confirming the longer-term uptrend remains intact.

If support holds, a rebound toward $4.30–$4.50/MMBtu is a plausible scenario. A deeper correction could test $3.71 or even $3.00–$3.50/MMBtu if bearish momentum persists

❄️ Weather and Demand Outlook

Over the weekend, forecasts shifted to colder temperatures, boosting heating demand across the Northeast and Midwest. Residential and commercial consumption exceeded 50 Bcf/d, driven by freezing temperatures and snowfall in major cities like New York. However, moderating temperatures later this week are expected to ease demand, capping upside potential.

🏭 Supply and Storage

Production remains robust, with daily output near 109 Bcf/d, keeping the market well supplied
The first seasonal withdrawal of 11 Bcf was reported last week, modest compared to historical norms
Storage levels remain above the five-year average, providing a buffer against short-term cold snaps.

🌍 LNG and Export Trends

U.S. LNG exports hit 10.7 million tons in November, a 40% year-over-year increase
Current export volumes are near 19 Bcf/d, with long-term capacity expected to reach 28–33 Bcf/d by 2030.
Global demand remains strong, especially in Europe, where Russian supply constraints continue to support U.S. flows.

🔍 Strategic Considerations

Short-term buyers may find value near technical support levels, but should remain cautious of further downside.
Hedging strategies should balance weather risk with storage comfort and export strength.
Basis markets in the Northeast remain volatile, with Transco Zone 6 NY hitting an intra-week high of $12.11/MMBtu on December 8 due to pipeline constraints

📌 Summary

Natural gas is in a technical correction phase, with prices consolidating near key support. Weather remains the dominant short-term driver, while strong production and LNG exports shape the broader outlook. Traders should watch for signs of a bullish reversal or deeper retracement as the market digests shifting fundamentals.

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