Natural Gas
A hydrocarbon energy commodity priced in $/MMBtu on NYMEX, known for extreme seasonal volatility driven by heating and cooling demand.
Natural gas futures trade on NYMEX with delivery at Henry Hub in Louisiana — the US benchmark pricing point connecting major interstate pipelines. The contract unit is 10,000 MMBtu (one British thermal unit × million).
Natural gas is famously volatile. Prices spike during cold winters (heating demand) and hot summers (power-generation demand for air conditioning), and collapse during mild weather or storage builds. Because gas is expensive to transport across oceans, US gas (Henry Hub) and European gas (TTF) can diverge dramatically.
The EIA Weekly Natural Gas Storage Report is the most watched inventory data release for the market.
Example
Front-month Henry Hub natural gas is at $2.75/MMBtu in early September. A polar vortex forecast pushes prices to $4.20 within two weeks — a 53% move driven entirely by demand pull, with no change in production.
Related Terms
Backwardation
A futures market where near-term contracts trade at a premium to deferred contracts, generating positive roll yield and signalling near-term supply tightness.
AdvancedBenchmark Price
A widely accepted reference price for a commodity that other grades, contracts, or products are priced against — WTI, Brent, Henry Hub, and COMEX gold are key examples.
BeginnerEnergy Complex
The collective term for energy-related commodities — crude oil, natural gas, refined products (gasoline, heating oil, diesel) — and the markets and instruments around them.
BeginnerSeasonality
Recurring, calendar-driven price patterns in commodities caused by predictable cycles in supply (harvest) and demand (weather-driven consumption).
IntermediateWTI Crude
West Texas Intermediate crude oil — the US benchmark grade traded on NYMEX, priced in $/barrel and settled at Cushing, Oklahoma.
Beginner