Oil at $70 per barrel in the midst of a massive recession and demand reduction is an unmistakable sign.
If the natural gas price were in its historic relationship with the crude oil price I would agree totally.
But I suspect that a good part of the crude oil price's defiance of gravity may well be derived from financialisation of the oil market, and 'macro' scale modern market manipulation by producers propping up the market price with zero interest money borrowed from ETFs via financial oil leasing.
The copper market was manipulated in a very similar way by Sumitomo/Hamanaka for ten years with the connivance of investment banks, five years of which was after the whistle had been blown.
The glut of distillates at the moment may be a sign that a period of unstable equilibrium in the oil market is heading for a discontinuity.
On the other hand, you may be absolutely right. "Any economic unit can emit money. The serious problem is to get it accepted" Hyman Minsky
Consider that the tin market and the copper market have rather dramatically been shown to have been manipulated and that the coffee market in Europe is showing strong signs of having been successfully cornered. Then apply the "Rule of Cockroaches". I suspect that many commodities are only realistically priced when there is a "market event". As the Dutch said while fighting the Spanish: "It is not necessary to have hope in order to persevere."
And lower natgas prices in the US are passed on partially to Europe as these past two years were supposed to see massive arrival of Qatari LNG into the US, volumes which instead went to Europe and helped depress prices there to some extent (at least in the UK, but less in Europe where prices are more dominated by oil-indexed Russian contracts). Wind power
But my point is that the market architecture of the natural gas market is structurally different in that it has not become financialised in the way that the oil market - which is also oversupplied, but no-one knows how much - currently is.
My thesis is that the crude oil market has been systemically manipulated by producers for some time, funded by 'free' money from ETFs.
I have seen no refutation of this, and via the FT Alphaville blog, directly and indirectly received considerable agreement. "Any economic unit can emit money. The serious problem is to get it accepted" Hyman Minsky
