Are natural gas prices set to increase in 2010? Yes, according to a recent article posted by the trusted financial web media company, TheStreet.com. Now may be the best time for gas investments, according to the article, due to the very fact that it is currently going nowhere.
Why would a stable or declining price on natural gas make it an appetizing investment? Besides, as of March 17, 2010, natural gas prices declined to a year-low of $4.27 per mMbtu.
On the contrary, the actual lack of gas investment makes it an appealing opportunity for anyone who would like to get into oil and gas investments, or be poised to make considerable profits when gas prices do rise. The best time to jump into an investment is when no one else wants it, right?
Demand is Poised
Natural gas is one of those resources that goes through a cycle of demand. Recent spikes in demand were seen in 2005 and 2008 when natural gas prices it $16 and $14 per mMbtu, respectively. These spikes in demand were not caused by reduced supplies of the resource. But rather, due to a rush in using natural gas products and resources.
Manufacturers announce new and “greener” products almost every day. And with natural gas being a quality “green” resource, products like natural gas automobiles, and buildings operating on natural gas energy are coming to the forefront of consumer demand. When these products are introduced by companies there tends to be a jump in gas investment activity.
And 2010 certainly has opportunities for new natural gas products that are used in power generation, transportation, aviation, fertilizer, hydrogen, and other domestic uses such as cooking, heating and cooling. Any announcement by Washington politicals or large corporations about an increase in natural gas can set the price jumping skyward.
Advanced Natural Gas Extraction Technology
Only within the last 20 years have we seen great advances in natural gas extraction methods. That’s great news for gas investments. Companies who are drilling for natural gas now have technologies that harness more natural gas from combined reservoirs of other fossil fuels such as oil and coal.
More companies are using horizontal drilling and liquidation techniques that transform natural gas into a liquid form, making it easier for extraction. In older methods, much of the natural gas pockets were burned or released while drilling for other fossil fuels. Unless there was an immediate demand for natural gas near a well, most of the gas was simply wasted.
However, new chemical reaction processes can turn natural gas into a liquid form of usable hydrocarbons that can easily be transported by tanker trucks. This is great news for gas investment opportunities and companies who wish to develop products for natural gas usage.
It’s not hard to see that gas investments can be a smart investment. A wise investor will always confer with a professional investment counselor. But ask about natural gas investments in 2010 and find out if the potential is worth your risk tolerance and patience.
Learn more about how you can profit from oil and gas investments at CBO Energy and its powerful natural gas investments.
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