Richie

Natural Gas: Naturally not Participating

I'm long XTO and CHK. Both are acting well today. But I don't understand why. There is no significant change in the outlook for Nat Gas prices other than the "hope" that we have a cold winter. So, unfortunately, I believe that recent strength in Nat Gas's price is probably just seasonal and unsustainable.

I know that vis-a-vis crude, it seems very underpriced and unloved, but that doesn't seem to impress anyone else. No one says buy it because as oil goes, so goes Nat Gas.

Hopefully, in the fullness of time, something will jog the price trend of Nat Gas so it will generate a long term escalation in the associated stock prices of the drillers/producers --- but I'm hard pressed to think of what such a catalyst might be.