What drives natural gas?

Natural gas prices in the US are at an all-time high. The Gulf Coast hurricanes and record summer heat have taken their toll, and business is feeling the effect. Studying and applying seasonality can often protect aganst the volatility of these markets, but, as Eric Fishhaut explains, even that is not a complete solution

A confluence of factors has driven natural gas prices in the US to all-time highs in the fourth quarter of 2005. In spite of a relatively mild autumn and predictions for moderate winter temperatures, record summer heat and two major hurricanes have been more than enough to drive markets to fear the worst.

Inventories started in April significantly above the previous year, but extra high air-conditioning demand, then the two Gulf Coast storms that hit in August and September, reduced supplies