Eight Days in January

By Wes Calder. From MFGCalcs Magazine, Issue 1, November 2026, page 48.

On Thursday, Jan. 15, a heat-treating line built for this story, one that buys a billion British thermal units of natural gas each trading day at the spot price at Henry Hub, paid $2,920 for a day’s gas. Eight days later, on Friday, Jan. 23, the same day’s gas cost the line $30,720.

Henry Hub is a pipeline junction in Louisiana whose price is the U.S. benchmark, and that Thursday’s price had been ordinary, inside the range the monthly average had kept to all through 2025. At the peak, spot gas was more than 10 times that price, the highest daily price in the Energy Information Administration’s records since at least 2008. Nothing about the line’s furnaces had changed. Whether a plant paid the day’s price came down to one clause in its gas contract.

The climb began the next day. Winter Storm Fern raised heating demand, cut production and drew gas out of storage that month, the EIA says, and the spot price rose on five trading days in a row. On the last of them, Jan. 23, it more than tripled in one day, the largest one-day rise in dollars in the agency’s records since 2008.

Henry Hub’s peak was not the most a plant paid. Paul N. Cicio, president and chief executive of the Industrial Energy Consumers of America, a group of manufacturers, wrote in March to a House subcommittee holding a hearing on the storm: “Some manufacturers paid natural gas prices as high as $154 per MMBtu. Prices rose so high that some manufacturing companies shut down because it was not profitable to operate.”

On Jan. 23 the line’s twin, built for this story and identical but for one clause of its gas contract, paid what it paid every day: a fixed price, agreed months before. Over the five trading days of the climb, the line on the index paid $51,160 for gas that would have cost $14,600 at that ordinary Thursday’s price.

A plant on the daily index paid the day’s price. The twin’s risk sat with whoever had agreed to sell it gas at the fixed price, and that protection cuts both ways: on any day the index sits below it, the twin pays more. The line had kept both the chance of a cheaper bill and the risk of a dearer one, and in January the risk came due.

Gas producers make the same choice from the other side of the trade. An exploration and production company told the Dallas Fed’s energy survey in March: “Between the historic January winter storm and the Iran war, our company strategy of selling into the spot market has been affirmed by these recent events. Fundamentally, we understand the premium that comes with one-off events like these, but they are still meaningful to our bottom line and also move the needle fundamentally per commodity.” Another, in the same survey, had hedged the price on part of its 2026 gas.

Then the price came down, though not in a straight line. By Feb. 9, less than three weeks after the peak, it was $3.25, back inside 2025’s range. The data show prices, not contracts, so they cannot say how many plants paid the week’s prices.

On Oct. 20, a day of the line’s gas cost $3,100, a little more than on that ordinary Thursday in January. The price came back. The money did not. For the twin on its fixed price, Jan. 23 was a day like any other. In the line’s books for the year, it still reads $30,720.

Live data from this story

• Henry Hub, Day by Day: Henry Hub natural gas spot price

Read it in the magazine

• MFGCalcs Magazine, Issue 1, November 2026, page 48