Wednesday, July 25, 2012

What Happens to Natural Gas When the Air Conditioners Switch off?

From the WSJ's Heard on the Street column:
A Summer Fling For Natural Gas 
...Teri Viswanath of BNP Paribas points to another problem for gas bulls. In each of the past two years, gas prices have enjoyed a strong summer as the heat brings demand into focus. But when the air conditioners have started switching off, the gas supply glut has reasserted itself and prices have weakened.

The Department of Energy expects gas output to continue rising this year and next. It is telling that even as near-term gas futures have risen sharply, prices further out haven't. No sooner will we be through this scorching summer than gas bulls will be praying for a freezing winter....MORE