Addressing the recent spike in natural gas futures prices, Jon M. Huntsman, the founder and chairman of Huntsman Corp. said traders on the New York Mercantile Exchange (Nymex) are responsible for forcing the price of natural gas to all time highs, which is severely hurting every U.S. natural gas consumer.
"This is a disaster for American industry, the American farmer and for the 55% of Americans who heat their homes with natural gas," said Huntsman. "It is particularly painful for those on fixed incomes who simply cannot afford to pay prices that are double most of the rest of the world. And the most aggravating part of this whole fiasco is that it absolutely is not necessary."
With frigid cold engulfing large portions of the country and winter storms sweeping east, natural gas futures traders pushed the January contract on Thursday to a high of $15.100, a new all-time high for any prompt month, unseating the old record of $14.750 that was set by the November 2005 futures contract on Oct. 5. January natural gas ended up settling at a new all-time prompt month high settle Thursday at $14.994, up an incredible $1.294 for the day.
Despite recording another new prompt month high of $15.200 on Friday, the January contract ended up retreating significantly to settle at $14.312, down 68.2 cents from Thursday's close.
"In the year 2001, natural gas inventories were lower than they are today, production and demand were at similar levels, and the price was $2.30/MMbtu," Huntsman said. "The traders and speculators will tell you these ridiculously high prices are simply the result of 'supply and demand'. Nonsense! There is no shortage of natural gas, and demand is no greater than it has been for several years. Further, inventories are at near record levels.
"Some speculators and traders are blaming cold weather for this maniacal price surge. That also is untrue. The country builds natural gas inventories for the very reason that weather is colder in the winter. The country is not drawing down its huge inventories any faster now than it has in the past," he added. "No, this is not an issue of supply and demand. It is an issue of traders and speculators on the Nymex hurting America on every front while they pocket outlandish profits. There is no need for this. It is outrageous and greedy."
Huntsman called on every American to contact members of Congress and the White House and demand that natural gas futures trading be brought under control.
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