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Hedge Funds’ Net Long Positions on US Natural Gas Rose

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The CFTC (U.S. Commodity Futures Trading Commission) will release its weekly “Commitment of Traders” report on July 14, 2017.

In its last report, the CFTC reported that hedge funds increased their net bullish positions on US natural gas futures and options contracts by 11,617 contracts or 14.3% to 92,583 on June 24–July 4, 2017. Hedge funds raised their bullish bets for the second consecutive week. It suggests that hedge funds are bullish on natural gas (UNG) (GASL) (FCG) (UGAZ) (DGAZ) prices.

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US natural gas price forecasts  

On July 11, 2017, the EIA (U.S. Energy Information Administration) released its monthly Short-Term Energy Outlook report. The EIA estimates that US natural prices could average $3.16 per MMBtu in 2H17. US natural prices averaged $3.04 per MMBtu in 1H17.

The EIA estimates that US natural prices could average $3.10 per MMBtu in 2017—1.8% lower than previous estimates. The EIA also estimates that prices could average $3.40 per MMBtu in 2018—0.4% lower than previous estimates.

US natural prices averaged $2.51 per MMBtu in 2016 and $2.63 per MMBtu in 2015. World Bank estimates that prices could average $3.17 per MMBtu in 2017 and $3.60 per MMBtu in 2018.

Impact 

President Trump’s energy plans and improving drilling costs and efficiency could increase US natural production. It would have a negative impact on natural gas prices.

Read Will the Crude Oil Futures Rally Be Short-Lived? and OPEC and Non-OPEC Meeting Could Drive Crude Oil Futures to learn more about crude oil.

For more on crude oil price forecasts, read Analyzing Hedge Funds’ Net Long Position on US Crude Oil.

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