Unpredictable Gas Prices

Investors in London are more pessimistic about U.S. natural gas prices than they’ve been since the early days of the COVID-19 pandemic. Although prices are at the lowest they’ve been since natural gas futures began trading in 1990, the experts have been betting that prices will drop even further. Recently, hedge funds and other financial players sold off a huge amount of natural gas in anticipation of falling prices.

Despite these low prices, stakeholders have failed to predict when prices would start to rebound. Prices continue to fall, partly due to mild weather from El Niño reducing the need for heating gas. With gas supplies remaining high in North America and Europe, investors face the risk of losing money unless there’s a clear sign supplies are dwindling.

Despite this bad news, shareholders are feeling more optimistic about oil. In one week, they bought a significant amount of oil futures, reversing their previous sales. This buying spree happened across various oil markets, suggesting a growing confidence in the oil sector.

Published by James Heinsman

James has worked as a hedge fund manager for years. As someone who has always enjoyed multi-tasking, James brings his vast financial experience and his hedge fund background to his position as writer and editor for Hedge Crunch. Editor James Heinsman can be contacted at james(at)hedgecrunch.com.