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How to Profit From the Natural Gas Shortage and Europe’s Energy Crisis

by | Sep 29, 2021 | Stocks

The energy crisis in Europe is foreshadowing what’s soon to come to the U.S. This winter, countries will fight over something that’s usually so readily available… But in a post-pandemic world, it will be in alarmingly short supply: heat.

The world will be more reliant than ever on natural gas to heat homes and keep industries running. 

But now there’s a natural gas shortage during a time of slow economic recovery, and there isn’t enough time to gather more to refill the depleted supply.

The ongoing energy crisis in Europe that’s causing natural gas prices to explode is also causing traders to start betting on oil — since people will start flocking to it as an alternative to expensive natural gas prices.

However, this shouldn’t come as a huge surprise to investors. The charts have been alluding to a natural gas shortage for weeks…

Heating Costs Could Skyrocket Due to Natural Gas Shortage

Taking a look at the charts, natural gas is making multi-year highs and oil just topped $75 per barrel — the highest it’s been since October 2018.

And now, word on the street is that the use of natural gas in the supply chain of electric vehicles will increase production by 7% annually.

The energy grid that powers all this electrical consumption for our beloved EVs is using natural gas because it’s a clean fuel. And while usually this would be great news for EV investors, there’s just one pesky problem: winter’s fast approaching.

We’re about to get hit with the coldest time of the year while there’s a huge shortage of heating oil.

Oil refineries can only produce either unleaded gasoline or heating oil at one time.

Do you know what that means?

When there’s a shortage of gasoline — like at the beginning of summer because of supply chain disruptions due to COVID-19 — refineries will be delayed switching over to create heating oil for the winter. And the switch is usually made early during the summer.

Due to this, there’s going to be a lot more stress placed on the electric grid — which is also having a shortage of natural gas at the same time. 

And ALL of this is going to happen while we’re getting knocked over by transitory inflation on the stock market.

So we’re going to have explosive moves in commodity prices whenever we have the slightest bit of supply problems. 

This is going to be a continuous story for the next three months, and I have a game plan on how to make money on the long side of this…

And the Cabot Oil & Gas Corp. (NYSE: COG) trade I have going for my Monthly Money Flows strategy is already raking in some serious profits…

This energy trade is already up over almost 400% on the options, up 25% on the common stock — and it has an exponential amount of room to grow going into October.

Watch the video below to learn more about this Monthly Money Flows trade and the natural gas shortage.

Send any trading questions to jeff@joyofthetrade.com and stay ahead of the markets, especially these choppy ones, by subscribing to our YouTube channel.

WRITTEN BY<br>Jeff Zananiri

Jeff Zananiri

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