⚡Natural Gas MarketWatch — November 12, 2026: December Pulls Back From a Nine-Month High as the Season's First Nor'easter Arrives

Tony Zelinski

6 hours ago

6 min read

⚡Natural Gas MarketWatch — November 12, 2026: December Pulls Back From a Nine-Month High as the Season's First Nor'easter Arrives

The rally took a breath — and then took it back. December natural gas touched a nine-month high near $3.40 intraday Wednesday before profit-taking and a thin Veterans Day session pulled it down 8 cents to settle at $3.2150, snapping a three-session winning streak. By early Thursday, the contract was climbing again, up nearly 3% to about $3.31, as the season's first nor'easter moved into the Northeast and colder forecasts held. The market is no longer debating whether winter is coming — it is debating how long the cold lasts.

Market Recap

The NYMEX December 2026 contract settled Wednesday at $3.2150/MMBtu, down 8.10¢ (−2.46%) from Tuesday's $3.2960 close, after trading as high as $3.397 — its highest intraday level since February. The pullback was the largest one-day decline since October 23 and came on light Veterans Day volume, with the bond market closed. The weekly picture is still firmly positive: December is up 21.7¢ (+7.2%) from Friday's $2.9980 close. Early Thursday electronic trading had December back near $3.306, up 9.1¢ (+2.8%) on the session, as the cold forecast held and short-covering resumed. The December contract expires November 25, so positioning will only get more active from here.

Key Bullish and Bearish Drivers

Bullish: the weather has finally turned. A nor'easter is moving through the Northeast Thursday into Friday, bringing the season's first accumulating snow to the interior — the Adirondacks, Green and White Mountains, Berkshires, Catskills, and Poconos — with rain along the I-95 corridor and temperatures running 20–25°F below seasonal averages. Lows east of the Mississippi fall into the 20s and 30s by Saturday, and the first freeze of the season reaches as far south as the Carolinas, Georgia, and Alabama. Forecasts keep the East below normal November 16–20. LNG feedgas is running at near-record levels, averaging a record 19.3 Bcf/d so far in November, and Lower 48 production has slipped to 112.3 Bcf/d, down from 113.4 Bcf/d in October. Global prices give U.S. exports a powerful pull: European TTF is near $29.21/MMBtu and Asian JKM near $31.33, roughly nine times Henry Hub.

Bearish: the cold may be brief — forecasts show temperatures returning toward normal after November 20, and the EIA's November outlook still expects Henry Hub to average just $2.87/MMBtu this winter, citing mild weather, ample storage, and rising output. Storage sits above the five-year average, and Wednesday's selloff showed how quickly the market takes profits when forecasts stop getting colder. The record fund short position — 636,576 short-only contracts as of last Friday's CFTC data — is still unwinding, but each round of covering leaves fewer shorts to squeeze.

Storage Fundamentals

The latest EIA report — released Thursday, November 5, covering the week ended October 30 — showed a 77 Bcf injection, slightly below the ~81 Bcf consensus but above the 61 Bcf five-year average for the week. Total working gas stands at 3,801 Bcf, 109 Bcf (−2.8%) below last year's 3,910 Bcf but 54 Bcf (+1.4%) above the five-year average of 3,747 Bcf, and within the five-year historical range. The next report arrives tomorrow, Friday, November 13, at 10:30 AM ET — pushed a day by the Veterans Day holiday — covering the week ended November 6. Analyst estimates a 67 Bcf build; the five-year average for that week is a 40 Bcf injection.

If the build comes in light, it would be the first sign that the cold snap is already tightening the balance.

Regional Basis Markets

The Northeast is about to get its first real test of the season. Spot gas is still cheap: Algonquin Citygate traded near $1.31 late last week, with Transco Zone 6 New York near $1.03 and Texas Eastern M-3 at $1.06 — deep discounts to a Henry Hub spot near $2.61 — as mild weather and ample Appalachian supply left the region oversupplied. But January 2027 forwards at Algonquin still top $20/MMBtu, with January basis near $17.64 over Henry Hub. This week's nor'easter is the first demand event of the season, and it arrives with the region's structural risk unchanged: last January, Winter Storm Fern drove Algonquin to $122.58/MMBtu and Transco Zone 6 New York to $142.72. Watch Algonquin basis, not just Henry Hub — and note that FERC on Wednesday rejected most of PJM's plan for connecting large new loads like data centers, keeping capacity tightness and upward pressure on power prices in the region.

Production Trends

Output is easing from record highs but remains near all-time levels. Lower 48 dry gas production has averaged 112.3 Bcf/d so far in November, per LSEG, down from 113.4 Bcf/d in October and the 115.0 Bcf/d August record. The step-down was sharp at the month turn: Appalachia and Haynesville pipeline receipts fell 3.26 Bcf/d on November 1, the largest one-day drop in three years, tied to producer curtailments and pipeline flow orders. EIA still expects output to reach a record 116.1 Bcf/d in 2027, driven by Permian growth and new pipeline capacity, while LNG exports are forecast at 19.0 Bcf/d in 2027 — up 26% from 2025. The structural pull is real: export plants are absorbing roughly a fifth of U.S. production at record feedgas levels, even as domestic prices stay low. That is the tension in this market — record supply growth against record export demand, with weather as the tiebreaker.

Broader Energy Context

Crude is swinging on diplomacy. WTI settled Wednesday at $86.53/bbl (+0.6%) and Brent at $92.76 (+1.4%), rebounding after U.S. strikes on Iran's Qeshm Island missile facilities and reports that two supertankers were disabled by mine explosions in the Strait of Hormuz on Wednesday night. Early Thursday, both fell back — WTI near $85.81 (−0.8%), Brent near $91.99 (−0.8%) — on reports that Vice President Vance plans direct talks with an Iranian representative and that U.S. envoys arrived in Moscow to discuss Ukraine and Iran. OPEC's November monthly report, released Wednesday, kept its demand forecasts unchanged — growth of just 0.18 million b/d in 2026 to 105.72 million b/d, and 2.55 million b/d in 2027 — while OPEC+ crude output jumped 2.04 million b/d in October to 41.23 million b/d, 97% of its pre-war February level, led by Saudi Arabia. API data showed U.S. crude inventories up 9 million barrels for the week ended November 6; the EIA petroleum report, delayed by Veterans Day, lands today at noon. Heating oil (ULSD) settled Wednesday at $4.2113/gal (+1.95%) and held near $4.211 early Thursday; RBOB gasoline traded near $2.606/gal. On the storm front, the National Hurricane Center reports no tropical cyclone formation expected in the Atlantic in the next seven days; a cold front, not a hurricane, is the Gulf's main weather feature this week.

What Energy Buyers Should Watch

The EIA storage report tomorrow, Friday, November 13 (delayed by Veterans Day) — analysts estimate a 67 Bcf build; a light number confirms the cold is already biting.
Whether the November 16–20 cold spell extends into December — the rally only holds if the 11–15 day outlook stays cold; a warm revision unwinds the squeeze.
LNG feedgas holding near 19 Bcf/d — record export pull is the market's structural floor.
January Algonquin basis — the season's first nor'easter is the first real test of Northeast deliverability.
The EIA petroleum report today at noon (API showed +9M bbl crude) and Friday's CFTC positioning data — the record short is still unwinding.
The EIA's $2.87 winter Henry Hub forecast — the official view says this rally is borrowed time.

Premier Energy Management Perspective

This is a market caught between two true stories. The EIA is right that the national balance is comfortable — storage above the five-year average, production near records, no storm threat, and a warm-leaning winter outlook. But the marginal molecules tell a different story: LNG exports are setting records, production is slipping, and the most crowded short in the market's history is still unwinding. For buyers in New Jersey and Massachusetts, the lesson is unchanged: Henry Hub is not your price. Basis is your price, and New England winter basis is priced for exactly the kind of cold snap the forecasts have now delivered. Locking winter positions while the national market is calm costs far less than chasing them after the first freeze.

Market Bottom Line

December gas gave back 8 cents Wednesday after touching a nine-month high, but early Thursday it was climbing again toward $3.31 as the season's first nor'easter moved in, and record LNG demand held the floor. Storage is comfortable, and the EIA still expects a mild, cheap winter — but the first real cold of the season is here, and the market is watching whether it lasts.