Ticker: NG
Exchange: NYMEX
Trading Hours: 10:00 A.M. - 2:30 P.M. (EST)
Contract Size: 10,000 million British thermal units (mmBtu).
Contract Months: All Months
Price Quote: Dollars and cents per mmBtu, for example, $2.850 per mmBtu
Tick Size: $0.001 (0.1) per mmBtu ($10.00 per contract).
Last Trading Day: Trading terminates three business days prior to the first calendar day of the delivery month.
Daily Price Limit: $3.00 per mmBtu ($30,000 per contract) for all months.

40 Yr Seasonal Chart Long-Term Chart Supply & Demand Tables

Fundamental Overview:

Natural gas accounts for almost a quarter of United States energy consumption, and the NYMEX Division natural gas futures contract is widely used as a national benchmark price. The futures contract trades in units of 10,000 million British thermal units (mmBtu). The price is based on delivery at the Henry Hub in Louisiana, the nexus of 16 intra- and interstate natural gas pipeline systems that draw supplies from the region's prolific gas deposits. The pipelines serve markets throughout the U.S. East Coast, the Gulf Coast, the Midwest, and up to the Canadian border. An options contract and calendar spread options contracts provide additional risk management opportunities.

The spread between natural gas futures and electricity futures - the spark spread - can be used to manage price risk in the power markets.

Because of the volatility of natural gas prices, a vigorous basis market has developed in the pricing relationships between Henry Hub and other important natural gas market centers in the continental United States and Canada. The Exchange makes available for trading a series of basis swap futures contracts that are quoted as price differentials between approximately 30 natural gas pricing points and Henry Hub. The basis contracts trade in units of 2,500 mmBtu on the NYMEX ClearPortsm trading platform. Transactions can also be consummated off-Exchange and submitted to the Exchange for clearing via the NYMEX ClearPortsm clearing website as an exchange of futures for physicals or exchange of futures for swaps transaction.

Key Trading Notes:

Supplies have been considered tight throughout the last several years. It seems like every year when winter comes around, people start to worry about the tight supplies of natural gas. The colder the winter, the more gas we use. This market can be very volatile during the winter months. It can also be influenced by many of the same events and conditions as crude oil. The theory is that natural gas is a substitute or competing product with crude. This market is not for the faint of heart. It can be very volatile and catch traders by surprise.

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