Just noticed nat-gas prices are getting hammered lately. March futures closed down over 2% yesterday, hitting a 4-month low. The reason is pretty straightforward - warmer weather is coming to the US, which means less heating demand. Commodity Weather Group shifted their forecast to above-normal temps across the western half through month-end.

What's interesting is the storage situation. With production staying elevated at 113.3 bcf/day and demand only at 101.4 bcf/day, the US is expected to flip from a storage deficit to surplus in the coming weeks. That's bearish pressure right there. The EIA also bumped up their 2026 production forecast to nearly 110 bcf/day, so oversupply concerns are real.

Compare this to Europe though - gas storage there is only at 31% capacity versus the typical 47% seasonal average. Pretty different picture depending on where you're looking. The contrast shows how regional factors matter. Back in January when that Arctic storm hit, nat-gas spiked to 3-year highs because freeze-ups took out about 50 billion cubic feet of production. Now we're swinging the other way with mild weather and high output.

Electricity demand was also soft recently - output fell 1.6% year-over-year in the week ending mid-February. Active drilling rigs are at a 2.5-year high though, so producers keep pushing supply higher. Seems like the supply-demand balance is tilting bearish for prices going forward.