U.S. natural gas futures have climbed above $5 per MMBtu for the first time since 2022, driven by a potent mix of deep winter cold and surging export flows. Prices have risen more than 70% since mid-October as a polar vortex tightens the market and heating demand accelerates. At this time, we advise investors to focus on stocks such as Coterra Energy ((CTRA Quick QuoteCTRA - Free Report) ), Cheniere Energy ((LNG Quick QuoteLNG - Free Report) ) and The Williams Companies ((WMB Quick QuoteWMB - Free Report) ).

Weekly Price Momentum Stays Strong on Runaway Winter Demand

Natural gas futures posted a 9% weekly jump, supported by colder-than-normal temperatures sweeping across much of the country. Front-month prices reached $5.289 per MMBtu late in the week after strong gains earlier, with national demand boosted by frigid lows from 0 to the 30s across the northern U.S. Futures also pushed above $5 for consecutive sessions despite a smaller-than-expected storage draw, reflecting strong conviction that upcoming weeks will see heavier withdrawals. Throughout the week, cold-weather forecasts held firm, ensuring steady upward pressure on prices.

The U.S. is enduring the coldest December since 2010, with widespread snowstorms driving a surge in heating needs. This spike has pushed natural-gas futures to three-year highs above $5 per MMBtu as households and businesses increase usage. Analysts expect substantial storage withdrawals in upcoming EIA reports as the polar vortex keeps temperatures well below seasonal norms.

Record LNG Exports Strain Domestic Supply, Amplify Price Sensitivity

Based on figures from financial firm LSEG reported by Reuters, U.S. LNG exports hit a record 10.9 million metric tons in November, while feedgas flows have surged too. Export volumes continue to rise as new capacity ramps up, intensifying competition between export loads and domestic heating demand during peak cold periods. Analysts note that the market is experiencing structural shifts in how supply is allocated, adding to price volatility.

A larger share of U.S. production is now flowing to LNG terminals, leaving less supply available for domestic balancing during cold snaps. Analysts warn that local consumers and exporters are increasingly competing for the same pool of gas, which makes the system more vulnerable to disruptions when extreme weather hits.

Final Thoughts

Natural gas is entering winter with strong momentum, supported by a powerful combination of weather-driven demand and robust LNG exports. With futures breaking three-year highs and structural supply factors in play, investors focused on the gas value chain may find the backdrop increasingly constructive. While volatility is likely to persist, elevated global demand and a colder-than-normal winter outlook point to a market that remains fundamentally supported.

3 Stocks to Focus on

Coterra Energy: It is an independent upstream operator primarily engaged in the exploration, development and production of natural gas. Headquartered in Houston, TX, the firm owns some 186,000 net acres in the gas-producing Marcellus Shale of the Appalachian Basin. The company’s share of natural gas in its overall production is more than 60%.

Coterra’s expected earnings per share growth rate for three to five years is currently 27.8%, which compares favorably with the industry's growth rate of 17.8%. Valued at around $21 billion, Coterra Energy — carrying a Zacks Rank #3 (Hold) — has a trailing four-quarter earnings surprise of roughly 6.6%, on average.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Cheniere Energy: Cheniere Energy holds a clear competitive edge as the first company to receive regulatory approval to export LNG from its 2.6 billion cubic feet per day Sabine Pass terminal. Strong operations and long-term contracts position the company for substantial growth in both revenues and earnings.

Backed by firm gas supply agreements for its Sabine Pass and Corpus Christi facilities, the Zacks Rank #3 company enjoys strong cash flow visibility and solid long-term growth prospects. Notably, over the past 60 days, the Zacks Consensus Estimate for Cheniere Energy’s 2025 earnings has moved up 26.3%.

The Williams Companies: With U.S. natural gas demand projected to grow significantly in the long term, The Williams Companies seems to be well-positioned to capitalize on the same, owing to its impressive portfolio of large-scale value-creating projects. With its extensive network handling a third of the U.S. natural gas and significant expansion projects in the pipeline, #3 Ranked Williams is set to benefit from favorable industry dynamics and growth prospects.

The Zacks Consensus Estimate for the company’s 2025 earnings per share indicates 9.9% year-over-year growth. Williams Companies’ expected EPS growth rate for three to five years is currently 17.6%, which compares favorably with the industry's growth rate of 10.5%.