It is clear that these prices move around quite a bit from month to month and from year to year. Natural gas price volatility is among the highest of all commodities that are traded on major market exchanges. The price can unexpectedly double in a matter of months. It can also tumble by 50 percent just as fast. The natural gas commodity price is so volatile because it is a market price, not a regulated price .
Market forces reflect the underlying supply and demand situations.
Since there is no regulatory oversight a sudden unexpected cold snap can send prices soaring. Conversely, an unexpected decline in the price of competing fuels, such as oil, can cause industrial customers to use much less gas than expected and the price of natural gas can decline precipitously. The figure shows monthly prices. The daily prices are even more volatile. If gas is put in storage in the summer and withdrawn in the winter, the cost of gas charged to consumers in the winter will be a blend of the current market price and the cost incurred when buying in the summer.