Natural Gas Posts 72 Percent Weekly Gain Ahead of Massive Winter Storm

Domestic energy production and infrastructure could be affected by arctic temperatures.

Strong winds kick up snow in Lowville, N.Y., on Jan. 23, 2026. Cara Anna/AP Photo

Natural gas prices soared 72 percent this week, bringing its year-to-date rally to 44 percent, as the United States braces for a massive winter storm.

On the New York Mercantile Exchange, natural gas futures surged $0.307, or 6.09 percent, to $5.352 per million British thermal units on Jan. 23.

Multiple states issued emergency declarations ahead of severe weather this weekend.

The National Weather Service released a forecast warning of a “significant” storm that will generate subzero temperatures, gusty winds, and heavy snowfall, and is expected to stretch from the Southern Rockies to New England.

“Catastrophic ice accumulations are expected from the Southern Plains to the Southeast/Mid-Atlantic,” the short-range forecast stated. “Dangerously cold temperatures [are] set to expand across much of the eastern two-thirds of the U.S. through early next week.”

Cold temperatures could linger into early February.

While there have been no reports of major natural gas production outages, the higher prices reflect substantial risk to output and infrastructure.

Market watchers say the top concern is pipeline freeze-offs, which can occur when arctic temperatures freeze water or hydrants inside wells, pipelines, or other equipment. The ice then obstructs fluid flow, thereby affecting production.

Output has already dropped by about 4 billion cubic feet per day, said Phil Flynn, an energy strategist at the PRICE Futures Group.

“There should be significant disruptions, and reports say that there could be more than 70 billion cubic feet (Bcf) of cumulative freeze-offs in the coming days and weeks,” Flynn said in a Jan. 23 blog post.

All eyes will be on Texas, he noted, because the cold blast could determine whether prices maintain their meteoric ascent or pull back.

“If the freeze-offs in Texas become significant if the weather gets cold enough there, that could be a game-changer for natural gas, but right now the market seems to be very volatile based on bets about how cold it will be and for how long,” Flynn added.

Investors have also been pricing in stronger home heating demand.

For the week ending Jan. 16, U.S. energy firms withdrew 120 billion cubic feet from natural gas inventories. The drawdowns were broad-based, largely occurring in the South Central (39 billion cubic feet), the Midwest (38 billion cubic feet), and the East (32 billion cubic feet).

Domestic stockpiles are 141 billion cubic feet higher than a year ago and 177 billion cubic feet above the five-year average of 2.888 trillion cubic feet.

All eyes will be on next week’s Energy Information Administration storage report, which could be one of the largest weekly withdrawals on record.

Still, according to analysts at the American Gas Association, supplies remain robust, and Canadian imports increased ahead of the freezing temperatures.

Heating oil futures also advanced $0.0608, or 2.65 percent, to $2.3593 per gallon. They registered a weekly jump of more than 6 percent.

Trump Sanctions Trigger Oil Rally

Crude oil prices surged almost 3 percent to end the trading week as President Donald Trump applied fresh sanctions on Iran, threatening supply disruptions in the Middle East.

Iranians attend an anti-regime protest in Tehran on Jan. 9, 2026. UGC via AP

The United States imposed sanctions on nine ships and eight associated companies linked to moving Iranian oil and petroleum products, tightening restrictions on Tehran’s energy trade.

The decision was made in response to the regime in Tehran cracking down on protesters, the U.S. Treasury Department said on Jan. 23.

“The Iranian regime is engaged in a ritual of economic self-immolation—a process that has been accelerated by President Trump’s maximum pressure campaign,” Treasury Secretary Scott Bessent said in a statement. “Tehran’s decision to support terrorists over its own people has caused Iran’s currency and living conditions to be in free fall.

“Today’s sanctions target a critical component of how Iran generates the funds used to repress its own people.”

Iran remains the fourth-largest oil producer among members of the Organization of the Petroleum Exporting Countries (OPEC). Tehran produces about 3.2 million barrels per day and remains a major exporter to China.

Also, Kazakhstan has struggled to restart production from one of the world’s largest oilfields.

These events sent energy prices higher. A barrel of West Texas Intermediate—the U.S. benchmark for oil prices—climbed $1.82, or 2.84 percent, to $65.88 on the New York Mercantile Exchange.

Brent, the international benchmark for oil prices, climbed $1.71, or 2.88 percent, to $61.07 a barrel on London’s ICE Futures exchange.