Natural Gas vs Gasoline: WTF?

Floyd Norris at the New York Times looks at the incredibly different trends for natural gas and gasoline, explaining the dynamics that have led to such an opposite outcome these past 5 years…

As the accompanying charts indicate, never in the two decades that natural gas and oil futures have traded have their prices diverged as much as they have now. On an energy equivalent basis, oil costs more than eight times as much as natural gas.

This week, the price of a million B.T.U.’s of natural gas fell below $2.20 for the first time since 2002, while oil prices slipped a little but remained above $100 a barrel. The last time natural gas was this inexpensive, oil cost about $20 a barrel.


Why One Gas Is Cheap and One Isn’t (NYT)







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