3 Natural Gas ETFs to Buy on the Dip -Breaking
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© Reuters. Three Natural Gas ETFs You Can Buy On The DipDue to the global energy crisis, natural gas prices reached record levels this year. Furthermore, because the EIA anticipates prices will remain high, at least through year’s end amid below-average inventories and rebounding demand, ETFs should benefit. Natural gas ETFs United States Natural Gas, United States 12 Month Natural Gas and iPath Series B B Bloomberg Natural Gas are good investments to take advantage of industry trends. Let’s discuss the funds.Natural gas prices are hovering near record high levels due to rebounding demand amid the global economy’s reopening. Prices are rising because of lower inventory levels than the average five-year period. U.S. gasoline futures have reached 12-year highs. The September gas futures rally reached $6.280, nearly twice the seasonally adjusted 10-year average of $3.0141.
The winter season is fast approaching, and so is the demand for LNG (liquefied natural gases). The U.S. LNG exports are nearing a record this year. Energy Information Administration (EIA), however, anticipates record-breaking LNG exports next year. The organization also expects that the winter heating season in the United States will be characterized by natural gas inventories at 4.8% lower than the average five-year period. This will help to keep U.S. natural gasoline prices high throughout the winter.
Natural gas ETFs like the United States Natural Gas Fund LP(UNG), United States 12 Monthly Natural Gas Fund LP [UNL], and iPath series B Bloomberg Natural GasSubindex Total ReturnSM (GAZ), are well-positioned to take advantage of this strong backdrop. It could make sense to invest in the ETF’s recent declines.
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