Nat Gas at a 10-year low

by Laura Ehrenberg-Chesler on January 19, 2012

in Employment,Energy

Natural gas prices are at a ten-year low, closing today at $2.29 per mcf.  In the near term, this is certainly not good news for energy companies that derive the majority of their revenues from the production of natural gas.  But if you are looking for reasons to be optimistic about the domestic equity market, these low prices may bolster your confidence.

Many industries that rely on nat gas to fuel production will have this windfall drop straight to their bottom line.  These industries include steel, chemical, and fertilizer companies.  Some companies have the ability to switch between coal and nat gas when the price becomes advantageous.  So, the environment will benefit as well.

While the rejection of the Keystone Pipeline Project was a blow to our nascent energy independence, our abundant, low cost natural gas will go a long way to helping the bottom line of domestic industrial, and manufacturing companies.  This is good for the employees of these companies, as well as their shareholders.

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