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Gold/Mining/Energy : Games Trader
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To: goldsnow who wrote (730)6/22/1999 9:26:00 PM
From: LaFayette555  Read Replies (2) of 1239
 
May not be relevant, but the natural gas market is somewhat detached from the oil market.

Oil is a world-wide commodity in that it is easely transported in tankers and traded for delivery world-wide.

Natural gas is a continental commodity - sold for delivery by pipeline
- it's much more of a 'regional' market because of that.

Very very few countries allow gas tankers to enter their ports because
nat.gas got the bad habit of blowing up. For example such a gas tanker blowing up in the port of Toronto would actually level a good part of down town.

Only the Japanese are in the habit of receiving tankers of liquified nat gas on a regular basis.

Also the costs of liquification for transport and degassing for use are not negligible.

Nat gas just does not travel well so it's market is domestic and greately influenced by the local climate : heating in winter and cooling in summer.

Nat gas the commodity is a weather play mainly, but still related to oil because of possible substitution of one for the other in case the prices get really out of wack. But such substitutions reguire re-fitting of the furnaces/turbines, is expensive and takes time so the 2 prices are not well correlated.

Spent 5 years working for a gas utility :

go modern - go natural gas - go BOUM .. our competitors would say !!
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