This is not helped by natural gas transportation not being instantaneous and storage can be limited. Power plants are the fastest-growing users of natural gas, since natural gas-powered plants are more environmentally friendly than coal or oil-based plants. Some natural gas power plants operate year-round, while others are more seasonal. The largest residential use of natural gas is home heating, especially in the winter. Other uses include boilers, furnaces, water heaters and outdoor barbeque grills.

How good is it to buy natural gas?

And as recession risks abound heading into the new year, “global oil demand should slow further,” says Francisco Blanch, head of Global Commodities and Derivatives Research at BofA Global Research. Still, Blanch sees “upside to oil prices from the European Union’s Russia oil embargo, a faster-than-projected China reopening, and a potential Fed pivot in the first quarter of 2023.” In addition to expansion, EQT reported solid Q2 results earlier this summer. Sales volume came in at 502 billion cubic feet, supporting $916 million in operating cash flow and $543 million in free cash flow. The company realized an adjusted EPS of 83 cents, far ahead of the 6-cent figure reported in 2Q21. The same, however, cannot be said for natural gas stocks, which driven by the macro conditions – namely Russia’s invasion of Ukraine – have delivered excellent returns for investors, even accounting for the segment’s recent pullback.

Maximizing price certainty: Fixing a price

Prior to the EIA report, major polls found analysts expecting an increase in the low 100s Bcf. The Energy Information Administration fed the bears with the fifth straight triple-digit storage injection this autumn, a record for this time of year. The 111 Bcf build easily surpassed the 73 Bcf five-year average injection and the year-earlier increase of 91 Bcf.

How good is it to buy natural gas?

COP has operations in 13 countries and total assets worth $95 billion. In the first nine months of this year, its production averaged 1,731 million barrels of oil equivalent on a daily basis. While Sorbara has a Hold rating on the stock, other Wall Street analysts are cautiously Forex news optimistic. PXD has a Moderate Buy consensus rating based on eight Buys, six Holds and one Sell. Check out Wall Street’s average, highest and lowest price targets for PXD on TipRanks. Wells Fargo’s top-rated analyst, Roger Read, is upbeat about SLB with a Buy rating.

Natural Gas Leaks

Investing in natural gas infrastructure companies that own pipelines and LNG export facilities is an alternative. Infrastructure companies should How to trade oil and natural gas? benefit from growing gas demand without direct exposure to pricing. In addition, infrastructure companies tend to pay attractive dividends.

  • That kind of outcome could persist long after winter is over, experts say.
  • That said, with heat dissipating and wind generation on the rise in the South Central region, Vortex Commodities CEO Brian Lovern said salt inventories would likely pass the five-year average before the withdrawal season gets underway.
  • The remaining natural gas is primarily methane with small amounts of other hydrocarbons.
  • An energy crisis the likes of which hasn’t been seen in decades is unfolding around the world.
  • What’s more, it is the only sector to post a double-digit percentage gain on the year.

She has worked in multiple cities covering breaking news, politics, education, and more. Get stock recommendations, portfolio guidance, and more from The Motley Fool’s premium services. Your donation today powers the independent journalism that you rely on. Sign up for the daily Marketplace newsletter to make sense of the most important business and economic news. This is because the contract represents 10,000 mmBtu, and 10,000 mmBtu multiplied by the $0.001 tick size results in $10.