• Supply (production and imports)
• Demand (consumption)
• Other factors
• Gaz pricing mechanism
• Gaz purchase mechanism
• Definitions

Natural gas prices are a function of the balance between supply and demand. Just like any other commodity traded on NYMEX, there are a multitude of factors influencing its price.

Demand is primarily influenced by temperature, residential, commercial and industrial demand, natural gas fired power plants, development of the Alberta oil sands (natural gas is used to create steam that heats the bitumen) and storage activities. Supply is normally influenced by meteorological activity near major production basins (ex. hurricanes in the Gulf of Mexico), exploration and production costs, pipeline capacity, geopolitical events and imports of liquefied natural gas.

Furthermore, in addition to supply and demand fundamentals, commodity prices on the NYMEX are also influenced by trading activities, whether asset based or speculative, which makes it that much more difficult to predict their evolution over time.

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