U.S. natural gas prices have risen sharply in recent weeks amid forecasts of a cold start to the winter season across the United States, according to a report released by UBS on Friday.
This price increase comes despite comfortable inventory levels at the start of the draw season, as market attention has now shifted to potential heating demand and continued growth in U.S. natural gas exports, UBS noted in its analysis. The investment bank emphasized that near-term prices remain highly sensitive to weather patterns and forecast updates.
UBS maintained its positive outlook on natural gas prices, based on assumptions of normal winter conditions. The bank pointed out that current inventory levels, while adequate, will face pressure from domestic heating needs and export requirements in the coming months.
The bank's analysts stated that higher prices will be necessary to ensure sufficient supply growth to meet the anticipated increase in U.S. natural gas export commitments in 2026. This supply-demand dynamic supports UBS's positive price outlook beyond immediate seasonal factors.
UBS concluded that long-term US natural gas contracts continue to offer value to investors, reflecting the company's confidence that prices will continue to be supported by structural export growth and not just by seasonal weather patterns.
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