⚡Natural Gas MarketWatch — October 26, 2026: November's Slide Accelerates Into Expiry Week

Tony Zelinski

26 minutes ago

4 min read

⚡Natural Gas MarketWatch — October 26, 2026: November's Slide Accelerates Into Expiry Week

The November NYMEX contract enters its final week of trading with sellers firmly in control. The prompt month settled Friday at $2.64/MMBtu, down 15.7¢ (-5.6%) on the session and its weakest close since late August — and early Monday trading already had it near $2.54, down another 4%. With expiry set for Wednesday, October 28, the market is staring down the same shoulder-season arithmetic that has driven the slide: mild forecasts, adequate storage, heavy production, and a global gas market on fire that U.S. prices still cannot touch.

Market Recap: No Bottom Yet

November natural gas settled Friday at $2.64/MMBtu, down 15.7¢ (-5.6%) — the contract's worst session of the week and a fresh two-month low. The prompt month has now lost roughly 56¢ since its $3.198 settle on October 15, a decline of about 17%. Early Monday Globex trading had November near $2.54, with December — the contract most traders have already rolled into — near $3.02, a spread of roughly 48¢ that will gap the continuous chart at expiry. Henry Hub cash has held near futures, but the physical market's relative tightness has done nothing to slow the futures slide.

Key Bullish Drivers

Global gas is at crisis pricing: Dutch TTF near €88/MWh (~$29/MMBtu), its highest since December 2022, and Asian JKM above $26 — while Qatar has lost two of its 14 LNG trains at Ras Laffan, about 17% of its export capacity, for years.
Middle East risk is roaring in oil: Houthi attacks on Saudi targets continued over the weekend, and Friday's rally took Brent above $116 and WTI to $103.27 before Monday's pullback. Any threat to LNG shipping through the Strait of Hormuz is a tail-risk bid for gas.
LNG feedgas is running hot: flows to U.S. export terminals averaged 18.2 Bcf/d in October, up from 17.9 in September, with a single-day print near 18.9 Bcf/d.

Key Bearish Drivers

Forecasts keep sliding warm: above-average temperatures across the Midwest and East through at least November 5, with the first week of November described as "very El Niño-like" — warm over most of the northern two-thirds of the country.
The National Hurricane Center expects no tropical cyclone formation in the Atlantic over the next seven days, removing the last seasonal supply-risk premium.
Storage is cooperating: the tenth straight below-average injection still left inventories above the five-year average, with the surplus position intact into winter.
Production, while off record highs, remains enormous: roughly 111.4–111.6 Bcf/d in October versus the 113.3 Bcf/d record set in August and September.

Storage Fundamentals: A Lean Build That Changed Nothing

The EIA's Thursday report showed a 77 Bcf injection for the week ended October 16, below expectations of roughly 80–83 Bcf and below last year's 86 Bcf and the 87 Bcf five-year average — the tenth consecutive below-normal build. Working gas totals 3,644 Bcf: 4.0% below year-ago levels (3,796 Bcf) but 1.0% above the five-year average (3,609 Bcf). The report briefly steadied Thursday's tape, but Friday's 5.6% plunge shows the market has moved on. The EIA's October outlook still sees end-of-October inventories near 3,850 Bcf, though recent below-average builds make that look optimistic. Next report: Thursday, October 29.

Regional Basis Markets: Northeast Spot Soft, Winter Premiums Intact

October's mild weather has crushed Northeast cash prices — Algonquin Citygate and Tennessee Zone 6 have spent much of the month trading at or below Henry Hub. But the winter story has not changed: Northeast winter forwards still carry large premiums to Henry Hub, pricing in pipeline-constraint risk the moment real cold arrives. Transco imposed tighter operating limits last week — a reminder that delivery capacity, not supply, is the Northeast's real winter risk.

Production Trends: Off the Record, Still Prolific

Lower-48 dry gas output has eased to roughly 111.4–111.6 Bcf/d in October from the record 113.3 Bcf/d set in August and September. The EIA's October outlook pegs 2026 average output at 112.2 Bcf/d, rising to 116.1 in 2027, alongside LNG exports climbing from 17.6 to 18.6 Bcf/d. In other words: the market is growing into its supply, and it will take a genuine cold snap — not just a cold day — to tighten the balance.

What Energy Buyers Should Watch

The October 29 EIA storage report — the first report of the December contract's tenure as prompt month.
The November contract expiry on Wednesday, October 28, and convergence with Henry Hub cash.
The 11- to 15-day weather forecasts: a cold shift could add 20–30¢ to December quickly.
LNG feedgas trends as new export capacity ramps into year-end.
Middle East developments: the oil bid is already there; gas follows if LNG shipping routes are threatened.

Premier Energy Management Perspective

This is exactly the kind of tape that rewards buyers who plan ahead of the crowd: front-month gas is down about 17% in eight sessions on nothing but weather, the curve is pricing the entire winter strip lower, and the market has never been more focused on the next two weeks of forecasts. Fundamentals are neutral-to-soft today, but the Northeast's pipeline constraints and the global price explosion are the two risks that can change the math overnight. Waiting for winter to arrive before acting is the expensive version of a strategy.

Market Bottom Line

Oversold and still sliding: November gas printed a fresh two-month low Friday and opened Monday lower still, and every driver that caused the slide — warm forecasts, adequate storage, heavy production, no tropical threat — is still in place. Until the weather changes, rallies should be treated as buying opportunities, not trend changes.

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