The oil sector has lately been hogging the limelight after a spectacular recovery that has seen the sector become one of the top performers in the current year. However, it's natural gas bulls who have been having a real ball with natural gas trading at its highest levels since 2014, outpacing oil and many other commodities.
On Friday, natural gas futures were trading up 0.9%, to $5.67 per million British thermal units (BTUs), their highest settlement price since February 2014. Natural gas prices are up 132.3% year-to-date while the biggest nat. gas benchmark, the United States Natural Gas ETF, LP (NYSEARCA:UNG) is up 109.6% over the timeframe.
Given this backdrop, buying stocks of natural gas producers would seem like the straightforward way to play the natural gas boom. Unfortunately, it isn't quite that simple since most producers have hedged their production for 2021 and most of 2022 at prices well below $3/MMBtu.