Williams Companies (WMB, news, chart), a Tulsa-Oklahoma-based natural gas company, is trading down $1.71 to $30.05 and trading in the options market is running three times the usual. Traders are leaning to the bearish side ahead of an August 7 earnings release, with 13,000 WMB puts and 6,800 calls trading on the day. The drop in the share price and the uptick in put volume comes as natural gas falls 72.9 cents to $8.66 per million BTU, below a 5-month low set on March 20. Natural gas has fallen more than 30 percent over the past three weeks.
In addition, the Wall Street Journal reports today (page C5), “US natural gas prices could be in for a fall next year, when additional output from elsewhere in the world should enter the market. Overseas production of gas that is supercooled into liquid form for ocean transport is set to increase by about one-third, to more than 11 trillion cubic feet by the end of next year, according to Waterborne Energy Inc., a Houston research firm that tracks the world-wide liquefied-natural-gas business.”
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Frederic Ruffy is a well-known trader, writer, and strategist who has spent years educating investors and creating intelligent, insightful, unbiased market observations that are frequently cited by the Wall Street Journal and other financial publications. As senior analyst, Fred provides frequent and regular notes and daily updates for activity of interest.