US natural gas markets grabbed global attention after trading activity hit a historic high at the CME Group. On a single day, more than 2.57 million natural gas contracts were traded, setting a new record and crossing the previous peak seen in 2018. This surge shows how sharply investor interest has risen as weather and supply concerns shake energy markets.
The main reason behind this jump is severe winter weather across large parts of the United States. Extremely low temperatures have increased the demand for natural gas, which is widely used for heating homes, offices, and industries. As people consume more gas to stay warm, prices tend to rise, and traders rush in to manage risks or take advantage of price movements.
Cold weather has also affected supply. In some oil- and gas-producing regions, freezing conditions disrupted production, reducing the amount of gas available in the market. This imbalance between rising demand and tight supply has made prices more volatile, prompting heavy trading in futures and options.
Natural gas prices climbed sharply over two consecutive days, posting gains of over 20 percent at one point. Many traders who had earlier bet on prices falling were forced to buy back contracts to limit losses, adding further momentum to the rally. As a result, short-term price swings became larger than usual.
Data from energy trackers showed that gas output in the Lower 48 US states dipped in January, while overall demand, including exports, rose strongly. The US remains a major exporter of liquefied natural gas (LNG), and global buyers continue to rely on American supplies, adding pressure to the market.
The impact was not limited to the US Gas prices in Europe also moved higher, as low storage levels and ongoing geopolitical tensions kept energy markets nervous. Any disruption or rise in US prices often influences global gas rates.
For investors, experts say caution is important. While high volatility can offer trading opportunities, it also increases risk. Keeping an eye on weather forecasts, storage data, and production trends will be key to understanding where prices may head next in the short term.
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