Here's Why Natural Gas Could Go To Zero

Natgas Krasting

Photo: Bruce Krasting

My friend who has been running hedge fund money for years had this to say: 

“Nat Gas could go to zero. Gas is a byproduct of drilling for oil. With US oil still worth $100+ a barrel, the drilling will continue, and more gas will be the result.”

“There are many things that are changing due to the cheap Nat. gas. Companies that are running short haul truck routes out of central locations are converting to gas. Chemical companies that use natural gas as a feedstock are seeing new opportunities. The first new ethylene plant (plastic from natural gas) in many years will be built in Oklahoma. This plant was going to be built in Mexico, but cheap gas has brought it back home.”

“The near zero cost of natural gas will transform energy use in America over the next five years.”

I’m not sure I believe in this “miracle” story just yet. But coming from this guy, the conversation has me wondering.

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.