Weather Doesn't Mean Much for Long Term Natural Gas Prices

This segment is from Tuesday's edition of 'Digging for Value', in which sector analysts Joel South and Taylor Muckerman discuss energy & materials news with host Alison Southwick. The twice-weekly show can be viewed on Tuesdays & Thursdays. It can also be found on Twitter, along with our extended coverage of the energy & materials sectors @TMFEnergy.

The dreaded "Polar Vortex" brought frigid temperatures throughout the United States. As a result, natural gas prices spiked. However, these weather-related blips are generally short-term in nature. In our analysts' minds, investors -- not traders -- should pay little attention to weather's affect on pricing. Instead pay attention to long-term demand trends, especially from the chemical sector with companies like Dow Chemical (NYSE: DOW  ) , LyondellBasell (NYSE: LYB  ) and Valero Energy (NYSE: VLO  ) sporting plans to spend several billion dollars on facilities that will use natural gas as a feedstock. More analysis can be found in the short clip below.

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Joel South

Joel is a University of Washington graduate and covers energy and materials for The Motley Fool. Be sure to follow The Motley Fool's energy and materials Twitter for all your energy and materials coverage.

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8/27/2015 3:10 PM
DOW $42.91 Up +1.86 +4.53%
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