Natural Gas Price

Check our natural gas price chart to keep up-to-date on the commodity’s live price, as well as longer-term price trends. Stay on top of the latest events affecting the value of natural gas with our news and analysis, which can also help when forecasting natural gas prices.

What Is Natural Gas and How Is It Used?

Natural gas, just like coal and crude oil, is a fossil fuel that has formed over millions of years from the remains of decayed plants and animals, compressed deep beneath the earth's surface.

First harnessed as an energy source in 18th-century Britain, natural gas truly began to come into its own in the 20th century, when the construction of pipelines opened up many new markets. Today, natural gas is primarily used for heating and cooling. It also powers manufacturing and is a key ingredient in industrial products, including fertilizers and pharmaceuticals.

Which Countries Are the Top Producers of Natural Gas Worldwide?

The top 10 natural gas producers possess almost 80% of the world’s reserves of this fossil fuel. These regions – along with their average annual outputs (measured in billions of cubic meters) – are:

• United States – 766.2
• Russia – 598.6
• Iran – 184.8
• Qatar – 164
• Canada – 149.9
• China – 138.4
• European Union – 118.2
• Norway – 117.2
• Saudi Arabia – 102.3
• Indonesia – 86.9

Source: The World Factbook, CIA (2018)

What Drives Natural Gas Prices?

Supply and demand are the main forces that drive natural gas prices, with even minor variations in either one substantially affecting its value. Factors that impact supply and demand, and therefore the price, of this commodity include:

• Production amounts: Any disruptions to production – such as adverse weather hampering drilling – can cause supply to drop and natural gas prices to spiral upwards.
• Storage levels: Storehouses of natural gas help to avoid shortages in times of high demand and to absorb excess production. If stores run low, the price of this commodity usually rises.
• Economic growth: In thriving economies, the commercial and industrial sectors tend to consume more energy, leading to increases in natural gas prices.
• Competing fuels: Competition from other energy sources, such as coal or solar power, can drive natural gas prices down.
• Weather: In addition to affecting production levels, weather conditions – such as cold snaps or heatwaves – can also heighten demand for natural gas.

What Makes Natural Gas Attractive to Traders?

Several factors make natural gas appealing for traders, including:

• Growth potential: Energy-sector giants – such as Total SA and Exxon Mobil – are committing substantial resources to help broaden the uses and availability of natural gas, a sign that they believe in its future.
• Clean fossil fuel demand: Natural gas burns cleaner and produces fewer carbon emissions than its fossil fuel cousins, coal and crude oil – making it a popular (and less-regulated) choice in an environmentally conscious era.
• Market expansion: The imminent development of a technique to mass-produce compressed natural gas (CNG) – which can be transported without the need for pipelines – could open up many new marketplaces.

For the latest natural gas news, visit our market news and trading strategies articles below.