Mark Anthony

Despite Dedicated ETFs, No Reliable Way to Play Natural Gas

The natural gas storage capacity of the WHOLE NATION, is roughly 4000 BCF (billion cubic feet). Each thousand cubic feet of natural gas is worth $3.50 as I speak now. So the value of all natural gas stored in all facilities is no more than $14B. Even if natural gas price doubles from here, there can be no more than $14B profit made in the whole sector of natural gas commodity, and that is a theoretical absolute top limit of possible profit.

The majority of profit that natural gas longs can make, will come from the shorts who bet big on the wrong direction, not from the appreciation of the commodity itself. Therefore expect extreme volatility and extreme price swing on both sides. I am expecting an explosive rally up, as natural gas is deeply over sold yet many shorts actually believed natural gas price can go below ZERO.