Energy Musings - February 13, 2026
The role of natural gas in protecting economies and societies during winter storms was highlighted by Winter Storm Fern. Gas was also critical to Europe's electricity supply in January.
Polar Vortex Confirms Importance Of Natural Gas
A polar vortex was unleashed on the United States in late January, and it also descended on parts of Europe. The bitter cold temperatures collided with weather features moving through the respective regions, unleashing snow and ice storms. In the U.S., the polar vortex morphed into Winter Storm Fern, as the weather service now likes to name winter storms. Fern extended across the Lower 48 states from New Mexico to New England, bringing challenging weather to millions of people.
The Energy Information Administration (EIA) posted the following chart on its website showing that the week ending January 30 marked the largest natural gas storage withdrawal since January 2010. We find it interesting that eight of the ten largest weekly withdrawals happened during January of the respective years. All of the record weekly draws lasted for one week, except for 2018, when January experienced two weekly records - the second and seventh largest weekly draws.
The EIA noted that the week ending January 30, 2026, amid Winter Storm Fern was the largest weekly draw in the history of the agency’s reporting. The 360 billion cubic feet (Bcf) of natural gas withdrawn from storage exceeded the five-year average for the same week by 89% (170 Bcf).
Winter Storm Fern generated the largest gas withdrawal in history.
The record withdrawal was driven by several factors: increased natural gas heating demand and production curtailments due to severe cold and winter weather. The bitter cold increased space-heating demand for natural gas consumption in the residential and commercial sectors, as well as increased demand for natural gas for electricity generation. According to Bloomberg L.P., the demand for natural gas in the residential and commercial sectors for January 23-26 averaged 29% higher, or 13.9 Bcf/d more than the five-year average.
The extreme cold and ice reduced the natural gas supply due to equipment freeze-offs and shut-ins. According to a Wood Mackenzie analysis, Winter Storm Fern knocked out 120 Bcf of natural gas production from late January to early February. That shut-in ranks in the top three freeze-offs of the last decade.
The combination of increased demand and reduced production forced the natural gas industry to draw down record volumes from storage and contributed to record spot gas prices. Following the record weekly gas withdrawal, working gas stocks were 1.1% below the five-year average for the corresponding week.
U.S. natural gas storage is now below the five-year average.
Additionally, spot gas prices soared to record levels for two weeks, with the week ending January 23 reaching $12.01 per thousand cubic feet (Mcf) and the following week’s price topping out at $13.80/Mcf according to EIA data. While the January 23 price did not exceed the record-high spot price during Winter Storm Uri in 2021, the January 30 price did, as shown in the next chart.
Fern sent spot gas prices higher than during the 2021 Uri storm.
Illinois natural gas utility Nicor issued a press release detailing the impact of Fern on its operations and the role the company’s gas storage played in meeting customer demand. During the peak delivery hour of 7-8 am on Friday, January 23, Nicor’s system delivered 194,000 MMBtu to 2.3 million customers in over 650 communities. Over the seven days of the extreme weather event, Nicor delivered more than 25 Bcf, 43% of which came from the company’s storage facilities.
The company explained that it buys natural gas during the year’s weakest demand periods, usually at low prices, and stores it to supplement the daily supply available on its system. Nicor estimated that had it purchased the gas withdrawn at prevailing prices, it would have cost ratepayers an additional $170 million. Nicor also stated that on the coldest days of the year, it delivers more than twice as much energy to homeowners as the Northern Illinois electric grid does on the hottest days of summer. That statement speaks to the critical role natural gas plays in helping people get through the cold times.
What happened in the U.S. during Fern was also experienced in Europe. However, Europe has fewer options for its winter fuel. The next series of charts shows the impact of the polar vortex on Europe’s winter energy and electricity needs, which have left the continent’s natural gas storage volumes at unseasonably low levels.
In January, natural gas generated the most electricity in Europe in years.
The chart above shows the monthly amount of European Union (EU) electricity generation from natural gas from January 2015 to February 2026. Last month, natural gas generated a record amount of power – 52,196 gigawatt-hours (GWh). It exceeded the prior record of November 2021 by nearly 10%. The importance of natural gas-generated electricity in the EU is surprising, given the EU’s focus on renewable energy for the continent’s energy future.
Although the EU’s gas storage was high heading into winter, the cold weather has drained the system more than anticipated. The chart shows the EU’s natural gas supply history (light green), the predicted winter supply (yellowish green), and the actual gas storage volumes (dark green and blue line). It is evident that heading into this winter, the EU anticipated that its gas supplies would not match historical levels. That position may have reflected a view that the winter would be warmer than it has been, or that other energy sources, such as electricity for heat pumps and radiant heating, would reduce the need for as much natural gas. Actual consumption has reduced storage volumes to much lower levels than anticipated.
A cold wave caused European gas storage to fall sharply.
The final chart shows the current gas storage levels for the various EU member states. Portugal (77%) has the highest level of current gas storage, followed by Poland and Sweden at 59%, and Spain (58%). On the other end of the spectrum, Croatia (17%), Ukraine (18%), and the Netherlands (19%) are the three lowest-capacity nations in the EU.
A wide range of gas storage volumes across European countries.
Despite the respective natural gas storage volumes, prices in both the U.S. and Europe are sharply lower than experienced during the polar vortex days. In the U.S., the current gas futures contract is at $3.22/Mcf, reflecting weaker future gas demand and adequate supply. The current futures price is well below the weekly spot prices of January 23-30, which ranged from $12 to $14/Mcf. Those extremely high prices were in response to the desperation of gas buyers during the bitter cold.
In the EU, the Dutch TTF natural gas price index is around $11/Mcf, down from the nearly $14/Mcf price on January 23. Comments from traders and European energy companies suggest they do not expect prices to rise as the continent heads into spring.
A debate emerging in the U.S. is whether the country has sufficient gas production to meet the expansion of the liquefied natural gas (LNG) export business and the growth in domestic consumption for generating electricity to power the surge in Artificial Intelligence data centers. We will be delving into this topic in a future Energy Musings.
Winter Storm Fern is highlighting the importance of natural gas for economies worldwide. In Europe, the need to import LNG to offset the loss of Russian natural gas is becoming a sensitive issue among many EU politicians. Natural gas may become a political issue in the U.S., too, as the battle over higher prices lifted by the growth of LNG exports may generate public anger, if and when people learn about it.