-
Natural gas futures tumbled 3.45% today to $2.938/MMBtu, extending YTD losses to 25% and extending the downturn among shares of gas production companies that rank among this year's worst performers.
- Nat gas was one of last year's most profitable trades, as investors bet last year that new gas-fired power plants and record high exports would help burn off excess supply, but a historic level of exports has not been enough to overcome weaker demand during a relatively mild winter and massive new supplies from fracking.
- Australia and the Middle East put so much gas on the market that it leaves little room for more U.S. export terminals that could help erase the domestic glut, says Robin Wehbé, portfolio director at Boston Company Asset Management.
- "Investors right now across the board just hate natural gas," admits Simmons analyst Pearce Hammond, but he also notes that many U.S. exporters have long-term contracts guaranteeing buyers for their gas.
- In today's trade: LNG -3.4%, SWN -2.9%, COG -2.4%, RRC -2.2%, AR -2.2%, NGL -2%, CHK -1.7%, APU -1.3%, EQT -0.8%, RICE -0.3%.
- ETFs: UNG, UGAZ, DGAZ, BOIL, GAZ-OLD, FCG, GASL, KOLD, UNL, GASX, DCNG