Natural gas prices

Natural gas prices, as with other commodity prices, are mainly driven by supply and demand fundamentals. However, natural gas prices may also be linked to the price of crude oil and/or petroleum products, especially in continental Europe. Natural gas prices in the US had historically followed oil prices, but in recent years have decoupled from oil and are now trending somewhat with coal prices.The current surge in unconventional oil and gas in the U.S. has resulted in lower gas prices in the U.S. This has led to discussions in Asian oil-linked gas markets to import gas based on the Henry Hub index(until very recently the most widely used reference for US natural gas prices). A recent high level conference in Vancouver, the Pacific Energy Summit 2013 convened policy makers and experts from Asia and the U.S. to discuss LNG trade relations between these regions.Note that, for natural gas price comparisons, $ per MMBtu multiplied by 1.025 = $ per Mcf of pipeline-quality gas, which is what is delivered to consumers. For rough comparisons, one million Btu is approximately equal to a thousand cubic feet of natural gas. Pipeline-quality gas has a BTU value slightly higher than that of pure methane, which has 1,012 BTU per cubic foot. Natural gas as it comes out of the ground is most often predominantly methane, but may have a wide range of BTU values, from much lower (due to dilution by non-hydrocarbon gasses) to much higher (due to the presence of ethane, propane, and heavier compounds) than standard pipeline-quality gas.