Winter isn’t coming, according to the natural-gas market

Following the warmest winter on record for the US, energy markets are behaving as if brrrrrs aren’t real.   

This week’s heating demand in the US is expected to run 49 heating degree days below the average for this time of year, according to the National Oceanic and Atmospheric Administration’s National Weather Service. And that’s poised to be a theme for the season. 

Taking their cues from weather forecasts for a mild winter, particularly on the East Coast and in the South, a closely watched natural-gas spread — March 2025 vs. April 2025 — is closing in on zero.

This spread is known as the “widow-maker” because it’s effectively a bet on how much supplies will be run down over the course of winter. As you can see, there’s been substantial variability in this spread at this time of year over the past five years.

Though economists make weather forecasters look like genuine soothsayers, there’s still room to be surprised on how winter ultimately shapes up. March is usually the last month where utilities bring gas out of storage to meet demand; by April, they’re in refill mode.

Major US natural-gas producers like EQT Corp have struggled this year amid low prices for the commodity, with even more diverse-energy companies like Chevron Corp failing to outperform the S&P 500 energy sector and significantly lagging the benchmark US index.

The US is starting the winter from a place of elevated supplies. Natural gas in storage is closer to the levels that prevailed in 2020 amid a locked-down economy than it is to its trailing five-year average.