Natural-gas futures dropped 5.7% to settle at their lowest level in more than two years after revised weather forecasts indicated a warming trend across much of the nation.
That dashed hopes that demand for the fuel to heat homes and businesses would increase any time soon and alleviate the glut of natural-gas supply plaguing the industry.
“As warmer-than-normal conditions eke their way back onto the weather outlooks out toward the end of January, natural gas is being absolutely crushed like a grape,” Summit Energy analyst Matt Smith said in a note.
The steep selloff pulled futures well below the level of $3 per million British thermal units, a range prices had been trading near for about two weeks. The drop also left analysts and traders wondering when—and how—the slide might stop.