US gas prices tied increasingly to oil, global demand: analyst
London (Platts)--6Jun2005
The days of domestic fundamentals serving as the only influence over natural gas prices "are over" as money managers turn increasingly to energy commodities to boost their portfolio returns and the US begins to compete for global supplies of liquefied natural gas, David Sobotka, president of Merrill Lynch commodities, said Monday. In remarks delivered at Interchange Energy's LDC Forum in Atlanta, Sobotka said investors who previously focused primarily on equities such as pension funds and insurance companies will dramatically alter forward curve natural gas prices over the next few years as paper demand for natural gas increases. "This trend is likely not only to continue, but to accelerate" and "will only add to the bullish bias," in gas prices, Sobotka added. Accordingly, the market will see more price movements that are difficult to explain based on existing fundamentals. This story was originally published in Platts Natural Gas Alert http://naturalgasalert.platts.com
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