3 Natural Gas Stocks Primed for Gains Amid Cold Weather Surge

• As cold weather snaps, natural gas prices marked their largest one-week percentage gain since January 2022.

• Stocks of natural gas providers such as Antero Resources and Cotterra Energy stand gain as winter takes hold.

• Meanwhile, US liquid natural gas exports hit new highs with strong demand from Asian and European markets.

Natural gas prices surged 19% last week, briefly surpassing the $4 mark and marking the largest one-week percentage gain since January 2022. This dramatic rise was fueled by a confluence of factors, positioning natural gas producers like Antero Resources AR, Coterra Energy CTRA and Gulfport Energy GPOR to capitalize on the rally. These companies stand to benefit significantly as the commodity gains momentum in a tightening market.

Frigid weather sweeping across the United States has been a key driver of this price surge. Forecasts indicate sustained low temperatures, with Arctic blasts gripping the Midwest and Northeast, dropping temperatures to as low as -20°F. Heating demand has surged, particularly in regions where natural gas is the primary source of energy for millions of homes. Analysts project continued tightness in the supply-demand balance as these cold conditions persist through January.

The impact of this demand spike is clear in storage data. While natural gas inventories remain slightly above their five-year average, weekly withdrawals are projected to exceed 200 billion cubic feet (Bcf) through this month, potentially surpassing the January 2022 record of 994 Bcf. As storage levels dwindle, upward pressure on prices becomes inevitable, further buoying market sentiment.

Record-breaking liquefied natural gas (“LNG”) exports are amplifying domestic market pressures. U.S. LNG shipments, driven by strong demand from Europe and Asia, have reached near-peak levels, tightening domestic supplies. European concerns over energy security, exacerbated by disruptions in Russian supply and an outage at Norway’s Hammerfest LNG terminal, have increased reliance on U.S. exports.

The global demand for LNG underscores its growing importance in the energy mix. As U.S. export terminals operate near capacity, domestic supply constraints intensify, contributing to higher prices. This trend highlights the interconnected nature of global energy markets, where international demand has a direct impact on U.S. natural gas dynamics.

Natural gas production in the Lower 48 states has faced setbacks due to freeze-offs, which temporarily reduce output during extreme cold. Recent data shows production dipping to an eight-week low of 100.1 Bcf per day. Combined with soaring demand and record exports, these supply disruptions add another layer of bullishness to the market.

While some relief may come as temperatures moderate in February, the current production constraints and robust demand suggest that prices could remain elevated in the near term. Analysts are closely watching whether the market can sustain its momentum, with $4.20 identified as the next resistance level for natural gas futures.