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Is Nat Gas The Best Way To Trade The Solar Eclipse?

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Is Nat Gas The Best Way To Trade The Solar Eclipse?

Natural gas stocks and ETNs like United States Natural Gas Fund (NYSE: UNG) and VelocityShares 3x Long Natural Gas ETN (NYSE: UGAZ) may see an uncommon catalyst this week — a solar eclipse.

On Monday, the moon, sun and Earth will be in perfect alignment for some of the continental United States, with the moon temporarily blocking the Earth from the sun. America’s solar power will be reduced by more than 10,000 megawatts, causing nat gas generators to help fill the void in energy demand.

America’s power grid operators are reportedly watching their monitors closely, as this will be the first solar eclipse to cover the entirety of the continental United States in nearly a century. Nat gas could therefore see a high level of demand this week, but the eclipse isn’t the only reason.

U.S. demand for nat gas is already expected to be elevated this week as early next week, hotter temperatures will prevail, causing Americans to crank those energy-sucking AC units up even higher.

In early afternoon Monday, UNG and UGAZ were trading 2.46 and 7.42 percent higher, respectively.

 

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