A lot of commodities went down in price in the second half of 2008. But especially natural gas has performed worse than any other. The price fell from a high of 13.5 USD to 3.50 USD or more than 75%.
As a result the industry went in forced hibernation. Last summer more than 1400 rigs were pumping gas, now only 884 are operating.
Supply is going to shrink soon.
Not mentioned here are investments into gas-powered vehicles or industries switching to gas.
Oil has risen 43% since Christmas. Gas has to follow soon.
Even better: in the futures pit we discover that speculators have bet heavily against a rise of prices. Commercials are long.
In a typical cycle the industry shrinks when a commodity is unprofitable, only leaving the most efficient outlets in operation.
There is a natural gas ETF (ticker: UNG). Observe the huge spike from last week.
As a result the industry went in forced hibernation. Last summer more than 1400 rigs were pumping gas, now only 884 are operating.
Supply is going to shrink soon.
Not mentioned here are investments into gas-powered vehicles or industries switching to gas.
Oil has risen 43% since Christmas. Gas has to follow soon.
Even better: in the futures pit we discover that speculators have bet heavily against a rise of prices. Commercials are long.
In a typical cycle the industry shrinks when a commodity is unprofitable, only leaving the most efficient outlets in operation.
There is a natural gas ETF (ticker: UNG). Observe the huge spike from last week.
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