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Natural gas jumped to the highest levels not seen in nearly 14 years buoyed by tight supply conditions, adverse weather conditions and declining inventories.
Investors could easily tap the soaring natural gas price with ETFs that deal directly in the futures market. These are United States Natural Gas Fund (UNG - Free Report) , United States 12 Month Natural Gas Fund (UNL - Free Report) and iPath Bloomberg Natural Gas Subindex Total Return ETN . These funds also soared to new highs in many years.
The supply conditions remain tight given the ongoing conflict between Russia and Ukraine, which is disrupting global supply in an already tight-supply market. The European Union’s proposed the sixth round of sanctions against Russia will make energy supply more complex (read: Top ETF Stories of April Worth a Watch in May).
Additionally, cooling demand is driving natural gas prices higher. Some parts of the United States moved away from heating demand toward cooling demand in the face of rising temperatures over the weeks ahead, per Reuters report. Further, lower production in the United States and lower inventories are adding to the strength. Gas in U.S. storage is 21% lower than the last year at this time.
Moreover, the uptick in price is also fueled by surging demand for U.S. liquified natural gas. Soaring global gas prices are prompting buyers from around the world to continue purchasing all the liquefied natural gas that the United States is producing. An increase in LNG export demand will likely continue given the higher demand in Asia and Europe.
United States Natural Gas Fund provides direct exposure to the price of natural gas on a daily basis through futures contracts. If the near-month contract is within two weeks of expiration, the benchmark will be the next month contract to expire. The natural gas contract is natural gas delivered at the Henry Hub, LA.
United States Natural Gas Fund has AUM of $466.8 million and trades in volume of around 8.2 million shares per day. It has 1.35% in expense ratio and has soared 115% this year (read: Natural Gas ETF Hits New 52-Week High).
United States 12 Month Natural Gas Fund (UNL - Free Report)
United States 12 Month Natural Gas Fund seeks to offer natural gas exposure without using a commodity futures account. The investment objective of UNL is to reflect the daily changes in the price of natural gas delivered at the Henry Hub Louisiana. Its benchmark is the near month futures contract to expire and the contracts for the following 11 months, for a total of 12 consecutive months. If the near-month futures contract is within two weeks of expiration, the benchmark will be the next-month contract to expire and the contracts for the following 11 consecutive months.
United States 12 Month Natural Gas Fund has accumulated $35.7 million in its asset base and charges 90 bps in annual fees. The product trades in a moderate average daily volume of 103,000 shares and has risen 102.7% this year.
iPath Bloomberg Natural Gas Subindex Total Return ETN
iPath Bloomberg Natural Gas Subindex Total Return ETN provides exposure to the Bloomberg Natural Gas Subindex Total Return, which consists of the contract in the Bloomberg Commodity Index Total Return that relates to natural gas (read: Best ETF Areas of a Brutal April).
iPath Bloomberg Natural Gas Subindex Total Return ETN is unpopular and illiquid, with AUM of $27.8 million and an average daily volume of 49,000 shares. Expense ratio comes in at 0.45%. GAZ has soared 138% so far this year.
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Natural Gas Scales New Highs: ETFs to Tap
Natural gas jumped to the highest levels not seen in nearly 14 years buoyed by tight supply conditions, adverse weather conditions and declining inventories.
Investors could easily tap the soaring natural gas price with ETFs that deal directly in the futures market. These are United States Natural Gas Fund (UNG - Free Report) , United States 12 Month Natural Gas Fund (UNL - Free Report) and iPath Bloomberg Natural Gas Subindex Total Return ETN . These funds also soared to new highs in many years.
The supply conditions remain tight given the ongoing conflict between Russia and Ukraine, which is disrupting global supply in an already tight-supply market. The European Union’s proposed the sixth round of sanctions against Russia will make energy supply more complex (read: Top ETF Stories of April Worth a Watch in May).
Additionally, cooling demand is driving natural gas prices higher. Some parts of the United States moved away from heating demand toward cooling demand in the face of rising temperatures over the weeks ahead, per Reuters report. Further, lower production in the United States and lower inventories are adding to the strength. Gas in U.S. storage is 21% lower than the last year at this time.
Moreover, the uptick in price is also fueled by surging demand for U.S. liquified natural gas. Soaring global gas prices are prompting buyers from around the world to continue purchasing all the liquefied natural gas that the United States is producing. An increase in LNG export demand will likely continue given the higher demand in Asia and Europe.
United States Natural Gas Fund (UNG - Free Report)
United States Natural Gas Fund provides direct exposure to the price of natural gas on a daily basis through futures contracts. If the near-month contract is within two weeks of expiration, the benchmark will be the next month contract to expire. The natural gas contract is natural gas delivered at the Henry Hub, LA.
United States Natural Gas Fund has AUM of $466.8 million and trades in volume of around 8.2 million shares per day. It has 1.35% in expense ratio and has soared 115% this year (read: Natural Gas ETF Hits New 52-Week High).
United States 12 Month Natural Gas Fund (UNL - Free Report)
United States 12 Month Natural Gas Fund seeks to offer natural gas exposure without using a commodity futures account. The investment objective of UNL is to reflect the daily changes in the price of natural gas delivered at the Henry Hub Louisiana. Its benchmark is the near month futures contract to expire and the contracts for the following 11 months, for a total of 12 consecutive months. If the near-month futures contract is within two weeks of expiration, the benchmark will be the next-month contract to expire and the contracts for the following 11 consecutive months.
United States 12 Month Natural Gas Fund has accumulated $35.7 million in its asset base and charges 90 bps in annual fees. The product trades in a moderate average daily volume of 103,000 shares and has risen 102.7% this year.
iPath Bloomberg Natural Gas Subindex Total Return ETN
iPath Bloomberg Natural Gas Subindex Total Return ETN provides exposure to the Bloomberg Natural Gas Subindex Total Return, which consists of the contract in the Bloomberg Commodity Index Total Return that relates to natural gas (read: Best ETF Areas of a Brutal April).
iPath Bloomberg Natural Gas Subindex Total Return ETN is unpopular and illiquid, with AUM of $27.8 million and an average daily volume of 49,000 shares. Expense ratio comes in at 0.45%. GAZ has soared 138% so far this year.