Why Isn’t the Market Rallying on Cold Weather?
Short-term cold blasts may grab headlines, but futures traders are more concerned with weather trends 10 to 15 days out. While the current system is producing lows in the teens to 30s across the eastern U.S., national demand is expected to ease mid-to-late week as much of the interior warms above seasonal norms. The 8–15 day pattern continues to lean too warm to support a sustained rally, dampening bullish sentiment.
NatGasWeather reported that long-range models continue to suggest a chilly start to December, but until those forecasts firm up, traders are unlikely to price in sustained upside. Even the recent weekend data, which added several heating degree days, wasn’t enough to change the broader view that mid-month weather looks neutral to slightly bearish for demand.
Record LNG Exports Provide Support, But It May Not Be Enough
One bullish underpinning comes from LNG exports, which hit a record high near 18.5 Bcf/day. While this supports a floor under prices, it hasn’t been enough to offset the bearish weather outlook. Traders remain cautious, with most awaiting confirmation of a more robust cold pattern before reestablishing long positions.
