Registered: 06/28/02
Posts: 15914
Loc: Old Saybrook (formerly Madison...
Buck: The relationship of Crude to NG is not really linear. NG is far more volatile. Today we're dealing with NG in the $4.50/MBtu range. It wasn't that long ago that it was over $10/MBtu, but it hit $15+ in the height of the market.
NG historically was $2-$2.50/MBtu for several decades, but once controls came off the trading of NG, it went absolutely haywire.
Since NG is a "domestic" product, it is much more capable of these spikes. NG from around the world needs to come into the U.S. on a much larger scale in order to flatten those price spikes.
In order to do that, we need much more LNG infrastructure. The U.S. NG infrastructure is probably the biggest stumbling block to increased usage of NG as a transportation fuel and in other applications. But we all know how popular that is today.
Everyone wants it cheap....plentiful....and with no infringement on any part of their life. You can't have it all.....