By FXEmpire.com

Introduction: Natural gas is nevertheless a major commodity in its own right, which is used for everything from cooking food to heating houses during the winter. Natural Gas is growing much faster than either of its non-renewable fossil fuel competitors, oil and coal.

Do not miss the weekly U.S. gas inventories report. The figures are issued by the Energy Information Administration (EIA) every Thursday afternoon at 15:30 (released Friday at 15:30 if there was a U.S. bank holiday on Monday). Here’s a link to the latest EIA report. The main natural gas moving figure in there is the change in inventories from the previous week. When it comes to the gas inventories report, we’re talking about billions of cubic feet, Bcf for short.

When the actual change in inventories number is released, it is the deviation from the expected number that is really important. If the actual inventories figure shows a 24 Bcf rise when an 84 Bcf increase was expected, then that is actually positive for the price of natural gas. All else equal, the price of natural gas should rise after the release.

A barrel of oil has roughly 6 times the energy content of natural gas. If the fuels were perfect substitutes, oil prices would tend to be about 6 times natural gas prices. However, due to various market characteristics discussed briefly above and the ease of using oil, the price of oil has been following a pattern of 8-12 times that of natural gas. However that ratio has spiked dramatically since March 2009.

Weekly Analysis and Recommendation:

Natural Gas ended the week at 2.47 as it was a wild week for the commodity. Speculators with little real data or eco support were able to run up the prices as high as 2.5457 after opening the week at 2.194.

Date

Last

Open

High

Low

Change %

Jun 15, 2012

2.470

2.537

2.557

2.445

-2.64%

Jun 14, 2012

2.538

2.187

2.543

2.170

16.00%

Jun 13, 2012

2.188

2.218

2.228

2.182

-1.33%

Jun 12, 2012

2.217

2.195

2.271

2.174

1.05%

Jun 11, 2012

2.194

2.260

2.284

2.193

-2.92%

The Energy Administration inventory remains high and there is no real increase in demand, so with the possibility of a hurricane, speculators pushed the prices up on Thursday and Friday and by late Friday began to sell of taking profits.

This commodity has been on a rollercoaster ride, that seems to have started the same day as crude oils drop from the 106. price. Kind of strange isn’t it.

FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more recent analysis and information in our weekly reports and we provide daily updates and outlooks.

Historical:

Highest: 6.106 on Jan 07, 2010

Average: 3.989 over this period

Lowest: 1.903 on April 19, 2012

Economic Events: (GMT)

WEEKLY

  • Natural Gas Weekly Update
    Release Schedule: Thursday between 2:00 and 2:30 p.m. (Eastern Time)
  • Weekly Natural Gas Storage Report
    Release Schedule: Thursday at 10:30 (Eastern Time) (schedule)

Click here a current Natural Gas Chart.

Originally posted here