Gas Spread Going Negative Shows Traders Doubting a Cold Winter
- U.S. forecasts have turned warmer through mid-December
- Hedge funds’ bullish bets have dropped from a six-year high
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A closely watched U.S. natural gas price spread flipped to negative, signaling that traders have all but given up already on the prospect of a cold winter.
Gas for January delivery is now trading below February prices, a first for the 2021 contracts. January futures tumbled to a two-month low on Thursday, for the worst performance among major commodities, as near-term forecasts for chillier conditions were scaled back. Temperatures may be above normal in much of the Midwest and parts of the Northeast in mid-December, according to The Weather Company.