Natural gas’ tendency to trade lower over the course of the winter is playing out in quicker fashion this year, with the prompt-month Nymex futures contract down nearly 35% since Nov. 1.

More often than not — around 64% of the time — Nymex futures have ended lower at the end of the November-March winter trading strip, down in 21 of the 33 such periods since the contract was launched in 1990, for a median decline of 13%.

Of course, the 2023-2024 heating season is just getting started with the heart of the winter still ahead. Prices could quickly pop if the season turns extremely cold, especially with increased volatility and short positioning, market participants told NGI. The possibility of production cuts is also getting more mention.

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