Anybody who has ever traded will know that nothing about markets is certain, so the idea of a predictable move is fundamentally flawed. That said, though, there are times in certain markets when it seems clear that a move in a particular direction is coming, it is just a matter of when it actually comes. That is true right now when it comes to US natural gas prices.An analysis of the most basic supply and demand factors suggests that, at some point, natural gas prices are moving higher.
The problem is that we might not yet be at that point. The August STEO lays out why that is so. After a hot July that increased electricity, and therefore natural gas demand in the US, August has been relatively cool, resulting in a drop off that will likely continue as fall weather takes over. And don’t forget, there is still a glut of natty in the system.