The fellow discussing 15$ may be spot on, or way off base, but his opinion remains valid.

Futures prices do not "forecast" prices in the future, not in the sense I believe you may thinking. To some degree futures do anticipate what may happen down the road. For example - winter futures prices for NG will always be higher than late spring prices. The "future" price changes as buyers and sellers compete with their own understanding, beliefs and expectations.

Like all markets, in any futures market, price trends form as higher swing highs and lows are set (in an up trend) or lower swing highs and lower swing lows are printed on the chart (in a down trend). Traders live and die by their ability to detect when price is trending, when it is not, and the strategies they employ to exploit the direction / presence, or lack thereof, of trend.

When price starts off with higher swing highs and lows, and continues higher, you can expect higher prices in futures contracts down the road.

Will we? Its entirely possible.

Consider this: NG prices have never been at these levels in the summer.

Prices we see today typically show up only in Nov/Dec / Jan/Feb, depending on weather and supply.

Whether or not the analyst quoted in the article is a trader, he is on the right track. All that is needed for his opinion to become reality is a) a continued tight gas market and b) cold weather.

"a" seems to be upon us already, even before the impact of Katrina, "b" is a total unknown.

Having said all this, I have to say that NG prices have run up so far and fast that the typical price reaction - all these other factors (hurricane, supply etc) aside, we'd normally see profit taking create at best a pause and retracement of some sort, or at worst a complete reversal.

Given the underlying issues in the North American NG market - for all intents and purposes a domestic market (no OPEC to the rescue here) - we can expect that any reversal here - even if sharp for a period of time - is very likely to be short lived and these high prices will be seen again.

At that time, as traders test the waters, price may then head higher.

The worst case outcome: price barely moves down and in fact uses the recent gap as a launch pad for another leg up. I've seen this happen in other runaway markets.

Ultimately price will get so high that serious problems hit the economy and price will then crash, but frankly, what are people going to do - freeze to death? Or put off buying that Xbox at Christmas...?

Recession is the outcome if prices head higher, bank on it.

But oil is also a major factor in NG pricing via the NG:Oil BTU ratio effect. The BTU content of each fuel, expressed as a ratio, has a fairly direct relationship to the price of NG.

This happens, in part, because its a convenient way to look at the 'value' of the fuel, but also because some industrial users (and electricty producers) are "dual fuel" capable -- able to switch between oil or NG depending on which is cheaper per BTU output.

Therefore, if oil stays high or higher, NG will tend to as well.

But the laws of supply and demand are not thrown out simply in favour of a ratio. If weather is mild, electricity demand does not overly lean on gas , and stocks remain high - NG will come in somewhat lower despite what oil does.