Staying Ahead of the Price Curve: The importance of risk management in a less volatile gas market

摘要

Natural gas has historically been among the most volatile commodities in the world. Over a period of less than 12 months from February 2008 through January 2009, prompt-month natural gas futures on the New York Mercantile Exchange (NYMEX) traded from $8/MMBtu to almost $14 and then retreated below $5 (fig. 1). At that time, natural gas end users were exceedingly interested in managing price risk and minimizing volatility. However, with prices settling into a more narrow trading range over the last year, some have questioned whether a risk management strategy is still an important part of energy procurement.