Natural gas seems to be hitting new lows these days. Yet, the government expects the price of natural gas to increase in 2010:
EIA expects this year's annual average natural gas Henry Hub spot price to be $5.37 per million Btu (MMBtu), a $1.42-per-MMBtu increase over the 2009 average of $3.95. EIA projects continuing price increases in 2011, averaging $5.86 per MMBtu for the year. EIA expects working gas inventories to end the first quarter at about 1,644 billion cubic feet (Bcf) compared with 1,734 Bcf in the previous Outlook, because of colder-than-normal weather in early January. [Citation here.]
Also, it's true that natural gas ETFs/ETNs may not necessarily track the actual price of natural gas, but they do seem to follow the general movement of prices. If the government is saying the prices are heading up, why not consider natural gas as an investment, albeit an admittedly speculative one?
Disclosure: I own GAZ and have owned UNG in my Roth IRA.
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