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Analyzing Natural Gas Prices: Summer 2005 Insights

FERC's Steve Harvey provides a comprehensive look at gas prices, addressing ties to oil prices, storage levels, and financial trading. Explore historical data from 1999 to 2005 and key market influences.

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Analyzing Natural Gas Prices: Summer 2005 Insights

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  1. Federal Energy Regulatory Commission Natural Gas: Summer 2005 Steve Harvey FERC July 25, 2005

  2. Gas prices for the past year(Daily NYMEX prices for the prompt month) Price ($/MMBtu)

  3. Gas prices for the last year have remained near recent highs Henry Hub Price ($/MMBtu)

  4. Gas prices are not related to storage inventory levels alone

  5. Clearly gas prices have some relationship to oil prices too

  6. Gas prices do appear related to oil and storage inventories 1999-2003 2004 2005

  7. Other effects may relate to financial trading

  8. $8.50 $8.30 $8.10 EIA Report Issued $7.90 $7.70 $7.50 Price ($ /MMBtu) $7.30 $7.10 $6.90 $6.70 $6.50 10:00 10:30 11:00 11:30 12:00 12:30 13:00 13:30 14:00 Financial trading prices appear to be driving physical prices at times NYMEX Settlement for December = $7.976 Monthly Index for December = $7.78

  9. Hard to measure the extent of financial trading Open Interest (thousand contracts)

  10. Financial trading activity appears to be increasing in 2004

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