How to Take Advantage of Falling Natural Gas Prices

Natural gas prices have quietly moved into territory that doesn’t come around often. 

U.S. natural gas calendar-year futures have continued to decline, with pricing for the next five years sitting well below long-term historical averages. More notably, many future delivery months are trading below the historical averages of where those same months have settled on the floating market.

For large energy users focused on managing long-term costs and risk, this is a market dynamic worth understanding.

Why Fixed Prices Are Falling Right Now

Several factors are shaping today’s pricing environment including: 

• Strong U.S. natural gas production
• Lots of gas in storage following the peak winter season 
• Confidence that LNG growth, power burn, and weather risk are “manageable”
  
  

Together, these inputs have created a broadly optimistic outlook for supply and demand balance.

However, it’s important to recognize that calendar-year strips do not trade on fundamentals alone—they trade on expectations. Expectations can shift quickly, especially when they are stretched over multiple years.

Infrastructure, weather patterns, policy changes, and geopolitical developments rarely move in straight lines. Yet the current curve assumes a remarkably stable environment for the next five years.

Where the Opportunity Exists

With calendar-year pricing from 2026 through 2030 uniformly cheap, buyers have the ability to evaluate longer-term strategies that weren’t available when prices were higher or more uneven.

This timeline supports:

• Multi-term pricing structures while the forward curve remains low
  
  
• Long-term budget protection during a period of broader economic uncertainty
  
  
• Locking in levels that are often referenced later as missed opportunities once conditions shift
  
  

Markets tend to look most attractive when the perceived need to act feels lowest. That’s often when risk is being underpriced.

Final Takeaway

The natural gas market is currently offering long-dated prices that are historically cheap and, in some cases, below what spot markets have typically delivered. That combination does not appear often.

While no one can predict the exact path prices will take from here, the current forward curve presents a rare opportunity to reduce volatility and anchor future energy costs at favorable levels.