Throughout 2012 and into this January natural gas producers have done far more hedging than consumers with the Henry Hub NYMEX futures contract. Producers are still locking in higher prices on the forward curve to protect the value of their future production in the ground. Today we review trends in hedger sentiment.
Natural gas futures surged over 12 percent on Thursday to close at $2.49/MMbtu following an unexpectedly bullish EIA storage report. Analysts interpreted the storage numbers as evidence that coal to gas switching in the power market has not yet reversed as we enter the summer peaking season. The next market report to hit trader’s desks after the EIA storage numbers is the Commodity Futures Trading Commission (CFTC) Commitment of Traders (COT) analysis released later today (Friday). In today’s blog “The Long and Short of It – COT Reporting” Sandy Fielden takes a deeper look at the value of the COT report.
