Winter storms, Bellamy during Thanksgiving, and now Chan (Dec. 1 -3), have brought heavy snow and freezing temperatures to much of the U.S. Natural gas consumption is breaking records in 2025 from robust LNG exports and AI/data center electric demand fueled by natural gas power plants. The start of heating season (November 1^st) has seen natural gas prices soar. We’re at $5.00/ Million Btu (Henry Hub), a value not seen since December 2022.  Natural gas prices are 66% higher above pre-heating season prices ($3.00 to $5.00). Freeze temperatures and deliverability are determining current natural gas prices. 

Upstream capital is funding natural gas development. A gas drilling boom is underway. Baker-Hughes reported 130 onshore rigs operating in U.S. gas basins on Wednesday (11.26.25). The Friday weekly drilling report was published on Wednesday due to the U.S. holiday. Overall, upstream drilling activity declined by 10 drilling units during Thanksgiving week.  Oil development/drilling was a casualty, having lost 12 rigs the previous week. Gas activity gained three units from 127 and miscellaneous drilling lost one. WTI crude oil prices below $60/bbl are unattractive for most U.S. development programs. 

Look for natural gas drilling to reach 140 active rigs in the coming weeks. Pipe, equipment and services may become tight as upstream rushes to secure limited end-of-year inventory.