Natural gas prices crash 26% in worst single-day drop since 1994
U.S. natural gas prices collapsed on Monday in the sharpest single-day drop for a front-month contract in three decades. The steep decline came as production surged and demand weakened, pushing stock futures to their lowest level since mid-January.
The Nymex March contract for natural gas (NG1:COM) plunged 25.6%, settling at $3.237 per million British thermal units. This marked the largest one-day percentage loss for a lead-month contract since 1994.
Production rebounded swiftly after freezing temperatures disrupted output earlier in the year. By Monday, U.S. natural gas production had climbed to 111.6 billion cubic feet per day—the highest level recorded since January 20. Analysts at EBW Analytics highlighted a 'far faster recovery' in key regions, particularly the Permian Basin.
At the same time, milder weather cut into demand. Private forecaster Commodity Weather Group reported a loss of 26.3 heating degree days, reducing the need for heating fuel. No updated figures were available on daily deliveries to households and industries since February 1.
The sudden price crash reflects a rapid shift in market conditions, with production outpacing weakened demand. Stock futures now sit at their lowest point in over a month, signalling potential relief for consumers but pressure on producers.
