Natural-gas markets are sending out bullish signals. Beware.
Tightening supplies, new outlets for demand, movements on pipeline tolls to make Western Canadian gas more competitive – if the summer’s a scorcher, prices could take off.
The risk in all of it is one that’s always lurking in the gas market: when wholesale prices climb into the sweet spot where shale fields can be developed at a reasonable profit, or when futures markets yield attractive opportunities to hedge, production quickly shoots up again. The party ends. It’s the way of the on-demand gas world brought about by fracking technology.Report Typo/Error