Understanding the Recent Volley in Natural Gas Prices

摘要

Like the action in a volleyball game, this past winter saw spikes, but these spikes were natural gas prices at Henry Hub, to levels not seen since 2010. Basis differentials in a number of markets also experienced unprecedented levels, especially in New England, where the month-ahead forward for January was over $20 per million Btu's and daily trades on the basis differential rose to nearly four times higher. Winter price spikes are common, but are they indicative of new equilibrium prices so much higher than the past two years?