Natural Gas Jun '19 (NGM19)
|Tick Size||0.001 per MMBtu ($10.00 per contract)|
|Daily Limit||7% above or below previous settlement|
|Contract Size||10,000 MMBtu (million British thermal units)|
|Trading Months||All Months|
|Trading Hours||5:00p.m. - 4:00p.m. (Sun-Fri) (RTH 8:00a.m. - 1:30p.m.) (Settles 1:30p.m.) CST|
|Value of One Futures Unit||$10,000|
|Value of One Options Unit||$10,000|
|Last Trading Day||Trading terminates three business days prior to the first calendar day of the delivery month|
Natural gas is a fossil fuel that is colorless, shapeless, and odorless in its pure form. It is a mixture of hydrocarbon gases formed primarily of methane, but it can also include ethane, propane, butane, and pentane. Natural gas is combustible, clean burning, and gives off a great deal of energy. Around 500 BC, the Chinese discovered that the energy in natural gas could be harnessed. They passed it through crude bamboo-shoot pipes and then burned it to boil sea water to create potable fresh water. Around 1785, Britain became the first country to commercially use natural gas produced from coal for streetlights and indoor lights. In 1821, William Hart dug the first well specifically intended to obtain natural gas and he is generally regarded as the "father of natural gas" in America. There is a vast amount of natural gas estimated to still be in the ground in the U.S. Natural gas as a source of energy is significantly less expensive than electricity per Btu.
Natural gas futures and options are traded at the CME Group. The CME's natural gas futures contract calls for the delivery of natural gas representing 10,000 million British thermal units (mmBtu) at the Henry Hub in Louisiana, which is the nexus of 16 intra-state and inter-state pipelines. The contract is priced in terms of dollars per mmBtu. The CME Group also has basic swap futures contracts available for 30 different natural gas pricing locations versus the benchmark Henry Hub location. Natural gas futures are also traded at the InterContinental Exchange (ICE) and at the International Petroleum Exchange (IPE).
Prices - CME natural gas futures (Barchart.com symbol code NG) on the nearest-futures chart started 2017 at $3.724 per mmBtu and moved lower all year to end 2017 down -20.7% at $2.953 per mmBtu.
Supply - U.S. recovery of natural gas in 2015 (latest data available) rose +4.7% to a record high of 32.895 billion cubic feet. The top U.S. producing states for natural gas were Texas with 27.4% of U.S. production in 2015, Pennsylvania with 16.7%, Oklahoma with 8.7%, Louisiana with 6.2%, Wyoming with 6.2%, Colorado with 5.9%, and New Mexico with 4.3%. In 2017 the world's largest natural gas producers were the U.S. with 2,401,945 Tera joules and Russia with 1,922,088 Terajoules of production.
Demand - U.S. total delivered consumption of natural gas in 2015 (latest data) rose +2.8% yr/yr to 25,054 billion cubic feet, of which about 38.6% was delivered to electrical utility plants, 30.1% to industrial establishments, 18.4% to residences, and 12.8% to commercial establishments.
Trade - U.S. imports of natural gas (consumed) in 2014 (latest data) fell -6.5% yr/yr to 2,695 billion cubic feet, down from the 2007 record high of 4,608 billion cubic feet U.S. exports of natural gas in 2014 (latest data) fell -3.7% yr/yr to 1,514 billion cubic feet, below 2012's record high of 1,619 billion cubic feet.
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