NOAA Weekly ENSO Outlook – Summary & Market Implications (as of December 22, 2025)
1. ENSO Status & Forecast
Current State: La Niña conditions are present. The Niño 3.4 index is at -0.5°C, with most Pacific SSTs below average.
Forecast: La Niña is favored to persist through the core of winter (Dec 2025–Feb 2026), with a 54–55% chance. A transition to ENSO-neutral is likely in Jan–Mar 2026 (chance rises to 68% by Mar).
Strength: This is a weak La Niña event (Niño 3.4 index between -0.5°C and -0.9°C).
Atmospheric signals: Classic La Niña patterns—easterly low-level winds, suppressed convection near the Date Line, enhanced convection over Indonesia, positive Southern Oscillation Index.
Key takeaway: The current La Niña is weak and expected to fade by early spring, but its atmospheric effects may linger into Q2 2026.
2. Typical La Niña Impacts on North American Weather
Winter 2025/26 (by Gas Region)
Region | Typical La Niña Pattern | Winter 25/26 Outlook (NOAA/CPC) | Market Implication |
|---|---|---|---|
Pacific NW | Cooler, wetter | Above-normal precip, cooler | ↑ Hydro, ↑ Gas for heating |
California/SW | Warmer, drier | Drier, warmer | ↓ Hydro, ↑ Gas for power |
Rockies | Colder, snowier | Variable, some cold risk | ↑ Gas demand (heating) |
Midwest/GL | Colder, snowier | Normal to cooler, variable precip | ↑ Gas demand (heating) |
Texas/South | Warmer, drier | Above-normal temps, below-normal precip | ↓ Gas for heating, ↑ Power |
Southeast | Warmer, drier | Drier, warmer | ↓ Gas for heating |
Northeast | Variable, often colder | Near-normal, but cold shots possible | Neutral to ↑ Gas demand |
Drought: Persistence in the Southwest, possible development in the Southeast. Improvement in the Pacific Northwest.
Storm Track: More active northern jet—frequent storms in the Pacific NW, Great Lakes, and Ohio Valley; fewer storms in the South.
Summer 2026 Outlook
ENSO-neutral likely: Less predictable regional signals.
Transition effects: Some lingering dryness in the South, but no strong temperature/precip bias expected.
Analog years: 2005–06, 2011–12 (weak La Niña to neutral transitions) suggest increased volatility, but no persistent extreme pattern.
3. Historical Analogues & Risks
Weak La Niña winters (e.g., 2005–06, 2011–12): Can produce sharp cold shots in the Midwest/Northeast, but less persistent cold overall.
Sudden Stratospheric Warming (SSW): La Niña winters have a moderate risk (60–75%) of SSW events, which can cause brief but intense cold outbreaks in the eastern U.S.
Renewables: Pacific NW hydro generation likely above normal; Southwest hydro below normal. Wind output may be volatile due to shifting storm tracks.
Recent Neutral Springs: 2012, 2017, 2019, 2021.
Weather in these years was highly variable and regionally patchy, with no strong national temperature or precipitation anomalies.
Key Point: ENSO-neutral springs often feature alternating warm/cold and wet/dry spells, driven by shorter-term patterns (AO, NAO, MJO).
4. Market View: Bullish / Bearish / Neutral
Winter 2025/26:
NORTH (Midwest, Northeast, Rockies, Pacific NW): Slightly bullish for gas demand—expect colder and snowier conditions, especially for the Midwest and Pacific NW.
SOUTH (Texas, Southeast, California): Bearish for gas heating demand—warmer, drier pattern, but could be bullish for power burn if hydro output is low in California/SW.
Overall: Neutral to slightly bullish for U.S. gas demand. The weak La Niña limits extreme cold risk, but periodic cold shots and regional demand spikes are likely, especially in the North and Midwest.
Summer 2026:
Neutral—ENSO-neutral phase means no strong, predictable bias. Watch for local drought persistence in the South and volatility from other climate drivers (e.g., MJO, NAO).
5. Visuals
Sea Surface Temperature Anomalies (La Niña signature):
NOAA 3-Month Temperature Outlook (Jan–Mar 2026):
Bottom Line:
Weak La Niña persists into winter, fading to neutral by spring.
Expect classic La Niña regional patterns: colder North, warmer/drier South.
Market risk is for cold shots and demand spikes in the Midwest/Northeast, with hydro and renewables volatility in the West.
Summer 2026 is likely to be ENSO-neutral, with less predictable weather-driven market impacts.
Market View: Neutral to slightly bullish for gas through winter; neutral for summer 2026.
For energy traders: Monitor for sudden cold outbreaks and regional demand surges, especially if SSW events occur or if the transition to neutral brings unexpected volatility.