Gains were to be expected after news of the polar vortex’s arrival in late January, but the actual magnitude was quite shocking. NYMEX natural gas rallied a whopping dollar in the front month this morning, up 26%, with even the summer months seeing significant gains. February settled at $3.907 US/mm, up 80 cents, March up 54 cents, and the rest of the summer up 39 cents on average. Having spoke with a few traders, we all agree this is the biggest we’ve ever seen, or have seen in a very long time.

It’s interesting because while this appears to be fundamentally-driven, it’s likely more speculative financial trading than anything. Spot prices at Dawn rallied but not to this extent, and physical traders are hesitant to immediately trust this benchmark. Note that American equity markets are down after more news of the USA instigating tensions with Greenland and global trade relations, so it’s possible that traders are instead dumping their assets in energy for some time before later retreating back.