Natural Gas Futures Options Trading
CALL 1-888-456-8090 TO BEGIN TRADING TODAY!INTERNATIONAL INVESTORS CALL 1-541-773-5741
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Natural Gas Futures Options TradingCALL 1-888-456-8090 TO BEGIN TRADING TODAY!INTERNATIONAL INVESTORS CALL 1-541-773-5741 |
Natural Gas Futures Advances As Crude Hovers Near Record, Dollar Falls May 9th, 2008Natural gas futures advanced as crude oil surged to a record and the euro climbed against the U.S. dollar. Oil touched $126.25 a barrel, the highest since futures began trading in 1983. The 15-nation currency versus the dollar today extended its gain from an eight-week low. Returns from investing in commodities have surged this year, led by natural gas, as investors sought alternatives to stocks. ``The natural gas move is 100 percent crude-price related,'' said Peter Linder, an analyst and senior adviser with Calgary- based DeltaOne Energy Fund. The fundamentals for gas are also ``very strong'' amid an outlook for reduced supplies. Natural gas for June delivery rose 27.4 cents, or 2.4 percent, to settle at $11.537 per million British thermal units at 3:05 p.m. on the New York Mercantile Exchange. It earlier rose to $11.569, the highest price since $11.88 on Dec. 29, 2005. Gas has gained 54 percent so far this year. The June through March 2009 contracts on the Nymex are in contango, a market condition in which gas for delivery in a subsequent month becomes more expensive than in the month before it. A steep contango encourages traders to buy gas and store it for later sale when it's more profitable. Linder, who in a March 5 interview with Bloomberg News forecast an average natural gas price of $11 to $12 per million Btu this summer, today modified his outlook to $12 to $14 because of surging crude oil. Oil has gained 21 percent since March 5. Gas closed at $9.741 per million Btu on March 5 and has advanced 18 percent since then. ``The real surprise going forward is going to be gas prices,'' said Linder. It will be moved by oil prices ``and speculative traders.'' Crude oil for June delivery gained $2.27, or 1.8 percent, to $125.96 a barrel in New York. Futures have advanced 31 percent so far this year and have more than doubled in the past year. Euro ClimbsThe euro today advanced for the fourth time in five days against the dollar, rising 0.6 percent to $1.548 at 3:43 p.m. in New York from $1.5394 yesterday. The dollar dropped 10 percent since Sept. 18, when the Federal Reserve began cutting rates to ease financial-market strains and stave off a recession. The U.S. central bank cut rates seven times while the European Central Bank has left rates unchanged. Oil at $200 is ``possible if we have a continuing devaluation of the dollar with respect to other currencies,'' Organization of Petroleum Exporting Countries President Chakib Khelil said yesterday at a press conference in Washington. InventoriesGas inventories in the week ended May 2 increased 65 billion cubic feet to 1.436 trillion, an Energy Department report said yesterday. Supplies were 11 billion cubic feet below the five- year average and 17 percent less than last year. ``To get to a comfortable 3.4 trillion cubic feet by next winter, weekly increases must average 76 billion until November,'' said Michael Fitzpatrick, vice president for energy risk management at MF Global Ltd. in New York in a note today. Stockpiles have increased an average of 68 billion cubic feet a week during the North American summer over the past five years, Bill Newman of Research Capital Corp. of Calgary, said in an April 14 report. Fundamentals``The same fundamentals that are driving crude are driving natural gas,'' said Brad Florer, a Kottke Associates Inc. trader in Louisville, Kentucky. ``The margin in supply for natural gas is LNG and it's tied to the dollar just as crude is because it's a global market.'' Shipments into the U.S. of liquefied natural gas, or LNG, for the first quarter were 800 million cubic feet a day, less than half of the 1.9 billion cubic feet in the same quarter a year earlier, according to research from Stacy Nieuwoudt, an analyst at Tudor, Pickering, Holt & Co. in Houston. Today Nieuwoudt revised her 2008 import forecast to 1.3 billion cubic feet a day from 2 billion. Imports in 2007 averaged about 2 billion cubic feet a day. Higher prices in Europe and Asia, where gas prices are linked to crude, lured LNG to those markets in the first quarter, she said. ``The U.S. market is the LNG market of last resort,'' Nieuwoudt said. ``When no one else needs LNG, cargoes flock to U.S. shores'' though that will not happen this year. Global trading of LNG rose about 8 percent last year as cold winter temperatures and the closure of nuclear plants in Japan boosted consumption, according to U.S. consultant Facts Global Energy. LNG is gas that is super-cooled to a liquid for transport by ship to markets not connected by pipelines. - Reg Curren in Calgary at Bloomberg. Click here for your Free Natural Gas Futures Trading eGuide |
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