![]() ![]() It is also important to note that nearly all participants in the financial gas market, whether on or off exchange, participate solely as a financial exercise in order to profit from the net cash flows that occur when financial contracts are settled among counterparties at the expiration of a trading contract. Most financial transactions for natural gas actually take place off exchange in the over-the-counter (OTC) markets using "look-alike" contracts that match the general terms and characteristics of the NYMEX futures contract and settle against the final NYMEX contract value, but that are not subject to the regulations and market rules required on the actual exchange. Monthly contracts expire 3–5 days in advance of the first day of the delivery month, at which points traders may either settle their positions financially with other traders in the market (if they have not done so already) or choose to "go physical" and accept delivery of physical natural gas (which is actually quite rare in the financial market). As a coarse approximation, 1000 cu ft of natural gas ≈ 1 million Btu ≈ 1 GJ. The standardized NYMEX natural gas futures contract is for delivery of 10,000 million Btu of energy (approximately 10,000,000 cu ft or 280,000 m 3 of gas) at Henry Hub in Louisiana over a given delivery month consisting of a varying number of days. Market mechanisms in Europe and other parts of the world are similar, but not as well developed or complex as in the United States. The natural gas market in the United States is split between the financial (futures) market, based on the NYMEX futures contract, and the physical market, the price paid for actual deliveries of natural gas and individual delivery points around the United States. ![]() Natural gas as it comes out of the ground is most often predominantly methane, but may have a wide range of energy values, from much lower (due to dilution by non-hydrocarbon gases) to much higher (due to the presence of ethane, propane, and heavier compounds) than standard pipeline-quality gas. Pipeline-quality gas has an energy value slightly higher than that of pure methane, which has 10.47 kilowatt-hours per cubic metre (1,012 British thermal units per cubic foot). For rough comparisons, one million Btu is approximately equal to a thousand cubic feet of natural gas. Note that, for natural gas price comparisons, $ per million Btu multiplied by 1.025 = $ per Mcf of pipeline-quality gas, which is what is delivered to consumers. For example, US dollars or other currency per million British thermal units, thousand cubic feet, or 1,000 cubic meters. ĭepending on the marketplace, the price of natural gas is often expressed in currency units per volume or currency units per energy content. This has led to discussions in Asian oil-linked gas markets to import gas based on the Henry Hub index, which was, until very recently, the most widely used reference for US natural gas prices. The 2012 surge in fracking oil and gas in the U.S. The highest peak (weekly price) was US$14.49/MMBtu ($49.4/MWh) in January 2005. The price as at 20th January 2022, on the U.S. Natural gas prices in the US had historically followed oil prices, but in the recent years, it has decoupled from oil and is now trending somewhat with coal prices. However, natural gas prices may also be linked to the price of crude oil and petroleum products, especially in continental Europe. Natural gas prices, as with other commodity prices, are mainly driven by supply and demand fundamentals. ( February 2022) ( Learn how and when to remove this template message) You may improve this article, discuss the issue on the talk page, or create a new article, as appropriate. The examples and perspective in this article deal primarily with the United States and Europe and do not represent a worldwide view of the subject. ![]()
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |