Menu
Crude oil, gasoline, heating oil, diesel, propane, and other liquids including biofuels and natural gas liquids.
Exploration and reserves, storage, imports and exports, production, prices, sales.
Sales, revenue and prices, power plants, fuel use, stocks, generation, trade, demand & emissions.
Energy use in homes, commercial buildings, manufacturing, and transportation.
Reserves, production, prices, employment and productivity, distribution, stocks, imports and exports.
Includes hydropower, solar, wind, geothermal, biomass and ethanol.
Uranium fuel, nuclear reactors, generation, spent fuel.
Comprehensive data summaries, comparisons, analysis, and projections integrated across all energy sources.
Monthly and yearly energy forecasts, analysis of energy topics, financial analysis, congressional reports.
Financial market analysis and financial data for major energy companies.
Greenhouse gas data, voluntary reporting, electric power plant emissions.
Maps, tools, and resources related to energy disruptions and infrastructure.
State energy information, including overviews, rankings, data, and analyses.
Maps by energy source and topic, includes forecast maps.
International energy information, including overviews, rankings, data, and analyses.
Regional energy information including dashboards, maps, data, and analyses.
Tools to customize searches, view specific data sets, study detailed documentation, and access time-series data.
EIA's free and open data available as API, Excel add-in, bulk files, and widgets
Come test out some of the products still in development and let us know what you think!
EIA's open source code, available on GitHub.
Forms EIA uses to collect energy data including descriptions, links to survey instructions, and additional information.
Sign up for email subscriptions to receive messages about specific EIA products
Subscribe to feeds for updates on EIA products including Today in Energy and What's New.
Short, timely articles with graphics on energy, facts, issues, and trends.
Lesson plans, science fair experiments, field trips, teacher guide, and career corner.
The natural gas futures market is a marketplace where standardized contracts for the future delivery of set natural gas volumes are traded. Most natural gas futures are bought and sold in the New York Mercantile Exchange (NYMEX) and the Intercontinental Exchange (ICE). Futures contracts allow participants to manage their exposure to market volatility by locking in a price today for a future purchase or a future sale of a physical commodity.
Natural gas futures contracts settle both physically and financially. Although other commodity futures might only have a financial obligation, this marketplace also bears the responsibility of physical delivery. A buyer must agree to receive natural gas at a future date at a specified location for a predetermined price, while a seller agrees to deliver the natural gas under these terms. However, less than 2% of NYMEX contracts are physically delivered.
Why do people trade natural gas futures contracts? The first natural gas futures contracts began trading at NYMEX in 1990, allowing producers, consumers, and financial traders to hedge against price volatility at the Henry Hub in Louisiana. Natural gas producers face uncertainty over their future revenue from sales, so they may sell a futures contract now to lock in a natural gas sales price for a future date. Similarly, natural gas consumers may buy futures contracts now to lock in a price for delivery at a time when they anticipate the price may be higher. Additionally, financial traders who typically do not have any direct interest in buying or selling natural gas also buy or sell futures contracts to gain financial exposure to commodities, to diversify financial portfolios, or for other reasons.
What are some common futures market pricing dynamics? Futures traded for the month immediately following the current month are referred to as front-month contracts, or Contract 1 futures. At the time of publication, August 2024 is the front-month contract. Natural gas futures contracts expire about 3–5 business days before the start of the front month.
Many commodities have a natural contango to their futures curve with prices for longer-dated contracts being higher than for those closer to delivery. This futures curve represents both storage costs and the costs of capital associated with tying up funds in advance of delivery. A commodity futures market showing backwardation suggests tighter supply or stronger demand today relative to the future. Market participants can be willing to pay a higher price for near-term delivery instead of waiting to pay a lower price for delivery in the future.
What influences directionality of the natural gas futures curve? The natural gas market can exhibit both contango and backwardation. The same general factors that affect today’s price of natural gas can also affect buying and selling of longer-dated futures contracts.
The major supply-side factors affecting natural gas prices are domestic production and imports. The major demand-side factors affecting natural gas prices are:
Storage volumes help balance the market. Stored natural gas can be used when demand outpaces supply and built when supply outpaces demand. For that reason, storage behaves as a source of both supply and demand within the natural gas futures market.
The shape of the forward curve is also contingent on its starting point. If today’s prices are atypically high or low, the resulting curve will be comparably steeper going forward in contracts. Increased natural gas demand or reduced supply in the short term can cause large changes in natural gas prices, especially during the wintertime.
How is the natural gas futures curve today? The natural gas futures market is presently in contango. The market currently indicates higher natural gas prices for next winter (Dec 2024–Mar 2025), increasing even further (+82%) through winter 2025–26. Overall, this contango reflects a market expectation for demand to surpass supply over that period. In particular, we project that the natural gas surplus to the five-year (2019–23) average will decrease with slowing production, while demand will increase as new liquefied natural gas terminals come on line.
Principal contributor: Andrew Iraola
Tags: natural gas, financial markets, futures
