Special Report: Recent Natural Gas Volatility and Cold Weather Impact Potential

Spot month NYMEX natural gas has traded as a bull trap, a short squeeze, and a move towards recent highs. It has been a trader’s dream and a procurer’s nightmare. Chasing prices causes emotional decisions and can lend itself to panic. The trading landscape isn’t headed for a respite but rather new unknowns to worry about. The ongoing Ukrainian/Russian tension is creating widespread uncertainty and weather has turned colder with incursions dropping iguanas out of trees and planners concerned about another polar vortex.

Last February there was chaos. Index pricing was bizarre and brutal. Those with fixed prices breathed easier and index procurers tried to survive. Although recent LMP numbers have been encouraging, the danger exists in some fashion and caution is advised.