Natural Gas Markets Get Boost From Ukraine Jitters

Natural gas markets have rallied quite a bit during the trading session on Thursday as Russia has attacked Ukraine. Because of this, there were quite a bit of large orders thrown into the market to pick up natural gas as there were concerns about supply. That being said, it is very interesting to see that natural gas is still flowing through the Ukraine pipeline, and into the European Union. Furthermore, until the United States becomes a major LNG exporter towards the European Union, this contract should not have much momentum to the upside. Furthermore, we are getting close to the end of the winter in the northern climates, so natural gas demand is going to drop anyway.

NATGAS Video 25.02.22

I have been looking for some type of spike to sell into, and I may have just got it. Regardless, I have no interest in buying natural gas anytime soon, because quite frankly it is a commodity that we have far too much of, and we also have quite a bit of supply out there to keep the markets flooded given enough time. Granted, we did not have as much production during the Covid outbreak, but at the end of the day, we have plenty of supply, so any rally will continue to be a temporary phenomenon. It is also worth noting that we had tested major support from the past, which has a bit of “market memory” attached to it. The market will continue to be volatile, but I still favor the downside regardless of the last couple of minor spikes.

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