The question of where 2026 will rank among the hottest years on record is a focal point for climate scientists, policymakers, and the public, as global temperatures continue to climb due to greenhouse gas emissions. The ranking is determined by the Global Land-Ocean Temperature Index (LOTI), maintained by NASA's Goddard Institute for Space Studies (GISS). This dataset combines sea surface temperature measurements from ships and buoys with land surface air temperatures from weather stations, providing a continuous record from 1880 to the present. Each year's temperature anomaly, relative to the 1951-1980 baseline, is used to rank years from hottest to coolest. The market resolves based on where 2026 lands in this ranking, with a tie resolving to the position of the tied year. Recent years have seen a remarkable streak of record-breaking warmth, with 2023 and 2024 both setting new all-time highs. 2024 was the hottest year on record, with an anomaly of 1.28°C above the baseline, surpassing 2023's 1.18°C. The El Niño event that began in 2023 contributed to these spikes, but even after El Niño faded in mid-2024, temperatures remained exceptionally high, surprising scientists. The long-term warming trend, driven by fossil fuel combustion and deforestation, ensures that each year is likely to rank among the top 10, but the exact position depends on natural variability, such as El Niño and La Niña cycles, and short-term factors like volcanic aerosols and solar activity. As of early 2025, the Pacific is transitioning from El Niño to a weak La Niña, which typically cools global temperatures slightly. However, the underlying warming trend means 2026 could still rank very high, possibly in the top 5 or even top 3, depending on the strength of La Niña and other factors. The market's outcome will be determined by the official LOTI data release, usually in January or February of the following year, but the resolution may be delayed if data processing is slow. This market attracts interest because it encapsulates the broader question of how quickly the climate is changing and what the near-term future holds, which has implications for policy, adaptation, and public perception. The interest in this market also stems from the practical applications of temperature rankings. They are used to communicate climate change to the public, as record highs are tangible evidence of warming. They also inform climate risk assessments for agriculture, insurance, and infrastructure planning. For scientists, the ranking provides a simple metric to track trends and test models. The market allows participants to express their expectations based on the latest data and forecasts, making it a real-time gauge of expert and public sentiment on climate trajectory.

Historical Context

The Global Land-Ocean Temperature Index has been maintained since 1880, providing a continuous record of Earth's surface temperature. The warmest years on record have all occurred in the 21st century, with the last decade (2015-2024) being the hottest on record. Prior to 2015, the hottest year was 2010, with an anomaly of 0.72°C, but that was surpassed by 2015 (0.90°C), then 2016 (1.02°C) during a strong El Niño. The trend continued with 2020 tying with 2016, and then 2023 and 2024 breaking records dramatically. The 2023-2024 El Niño was a major factor, but the persistent warming trend is primarily due to rising greenhouse gas concentrations. The last time a year ranked in the top 10 but was not in the 21st century was 1998, which was the hottest year at the time but now ranks around 12th. This demonstrates the rapid pace of warming. La Niña years, such as 2011 and 2017, tend to be slightly cooler but still rank among the top 10 due to the baseline shift. For example, 2011 had an anomaly of 0.61°C, which was the 11th warmest at the time but would be cooler than any year since 2015 except 2021 (0.85°C). The definition of a 'record' has evolved as the dataset is updated. NASA regularly updates the LOTI with new data and occasionally adjusts historical values due to improved processing, which can slightly alter rankings. For instance, the 2024 anomaly was initially reported as 1.28°C, but later revisions may change it. The market's resolution will use the final version of the dataset as released, which is the official record for that year. This historical context is important because it shows that rankings are not static and can shift with data revisions, but the overall trend is unambiguous: recent years are significantly warmer than any earlier period.