Natural gas prices have certainly been higher in the past than they are currently, but that doesn’t mean managing price risk and buying decisions have become easy. Volatility remains a reality and it continues to impact costs and profit margins. Buying at month-end index has been effective so far this year, but history tells us that the market will change and your company will need a less static strategy to reduce surprises and manage exposure as these shifts occur.
Businesses that face natural gas market exposure need to protect budgets with a fact-based, methodical, and non-speculative buying approach. Strategies that aim to control the average price paid (rather than “beat the market”), manage risk (rather than “eliminate” risk), and are evaluated against company objectives (rather than graded against “the market”) prove to have the most success over time.
Planalytics GasBuyer Solution brings weather-based market analytics together with a mathematics-driven, multi-month buying approach to effectively navigate market fluctuations and reduce costs. Dollar cost averaging, ladder buying, and other strategies tend to perform well in certain conditions, but become less useful or even have a negative impact in different market scenarios. Planalytics’ approach has proven to be consistently effective over time in any market profile, whether prices are rising, falling, or mixed.
Join Planalytics on October 1st for a timely discussion of what has happened in the market, what we can expect heading into the critical winter season, and a look at how hedging and procurement strategies may perform going forward.
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