Farmers are looking for ways to limit their risk exposure to a possible price surge in natural gas. In the period from March to September 2005, the price of natural gas increased by 72 per cent. This has been driven by several factors including a 21 per cent increase in crude oil and the gap between the price of crude oil and natural gas shrinking and ultimately reversing. This is especially unusual given that the price spread between crude oil and natural gas is typically at its greatest in September each year. Furthermore, storage levels of natural gas have moved from above-normal to near-normal as a result of high summer demand and hurricane damage in the Gulf of Mexico (Natural Gas Markets - Pre-Heating Season Update, October 2005, Canadian GasAssociation).
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