Hi everyone,

As you know, the price of natural gas is falling.

In this context, I would like to buy some natural gas, and keep my position for a year or two, hoping the gas goes during this period towards 5k or 6k.

I think it has quite a cost to keep the position so long. How to estimate that cost ?

Thank you

Guess it depends what you mean by cost?

If you buy prompt month gas with the intention of rolling and holding, the unseen cost is roll yield. Feb23 settled at $3.109 but Feb25 settled at $4.659. Hence if the market literally did nothing for 2 years, and you bought and rolled every month in two years you would own a Feb25 contract with a price of $4.659. So even though the outright price is up 50% you would have made nothing. To capture that 50% increase you will need to buy physical gas and put it in storage.