EQT Expects $1 Billion Windfall on Storm-Driven Gas Price Rally

EQT Corp. stands to pocket $1 billion in February alone as the natural gas producer reaps the benefits of its fortuitous position ahead of one of the steepest price rallies in the history of the US gas market last month.

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The second-largest US gas producer by volume entered 2026 almost entirely unhedged, giving the company a major advantage during a record rally when a historic winter freeze boosted demand for the heating fuel and knocked out production.

As weather forecasts suddenly changed in late January ahead of the storm, EQT agreed to sell 98% of its expected gas production for February delivery at more than $7 per million British thermal units, more than double the prices seen about two weeks earlier.

Thanks to those sales, the Pittsburgh-based company expects to notch its best month of free cash flow in the company’s 138-year history in February, Chief Executive Officer Toby Rice said in an interview with Bloomberg.

The record windfall is a reversal from years earlier when EQT and its peers hedged most of their production. As a result, several producers missed out on extraordinary price surges, first in 2021 — when post-pandemic demand rebounded — and later in 2022 when Russia invaded Ukraine. The war disrupted supplies, sent global gas prices spiking and resulted in much of Europe looking to US supplies to replace Russian pipeline gas.

Producers use financial contracts such as swaps and options to guarantee revenues and protect against sudden drops in prices, but they can backfire when prices unexpectedly skyrocket instead. EQT lost $3.8 billion on derivatives in 2021 and $4.6 billion in 2022 as gas prices soared far above what the company had agreed to sell for its hedges.

“I remember going through that situation, saying, ‘We could spend all this time drilling a little bit faster, completing wells more efficiently,’ ” Rice said. But what really made a difference, he added, was reducing expenses by acquiring pipeline infrastructure in 2024, which has allowed EQT to lessen its dependence on hedging.

While some of EQT’s peers see increasing volatility in the US gas market as reason for even more protective hedging, Rice is focused on the opportunity.

“Our approach is volatility is here, we’re going to take advantage of it,” he said.