| Updated: November 5, 2025Our team of expert traders tested several regulated and trustworthy natural gas trading brokers and compiled a list of the best among them. Every platform allowing CFDs on natural gas received a quality score based on several factors, including Trustpilot rating, regulation, fees and commissions, available trading platforms, customer service and more.
Plus500 USThis content applies only to Plus500 US and clients from the United States. Trading futures involves the risk of loss.- eToro61% of retail investor accounts lose money
- Fusion Markets74-89% of retail's CFD accounts lose money
- FP Markets73.85% of retail investor accounts lose money
- Global Prime74-89% of retail CFD accounts lose money
- Pepperstone75.5% of retail investor accounts lose money
Natural gas trading brokers
It goes without saying that when traders want exposure to the natural gas market, the broker they choose plays a crucial role. Picking a professional, trustworthy and reputable broker might take a while, considering how vast the range of options is. There are a number of factors to consider, and traders should closely examine the broker’s track record, the available instruments, the jurisdictions in which the company operates, whether fees are charged when depositing or withdrawing funds, whether customer support is available at all times, and whether assistance is offered in their own language, among others.
TRADE NOWREAD REVIEWRegulatorsCySEC (Cyprus, # 371/18), FSAS (Seychelles, # SD130), FSCA (South Africa, # 50926), SCB (Bahamas), ASIC (Australia, # 286354), FSCM (Mauritius, # GB21026264)PlatformscTrader, IRESS, MetaTrader 4, MetaTrader 5, TradingView1. FP MarketsMin Deposit$50 (AU$100)Fees- No deposit fees
- 2% up to 30 USD + country fees for withdrawals via Neteller
- 1% + country fees for withdrawals via Skrill
- 0.50% for withdrawals via FasaPay and Perfect Money
Deposit Methods
Commissions$3 per 100,000 lots tradedSpreadEUR/USD: AVG 1.2 pips, GBP/USD: AVG 1.4 pips, USDJPY: AVG 1.5 pipsWithdrawal Methods Leverage EU1:500 (CySEC | Pro Account), 1:30 (CySEC | Retail Account)Leverage non-EU1:30 (ASIC | Retail Account), 1:500 (FSAS | Retail Account)InstrumentsCommodities CFDs, Crypto CFDs, Energy CFDs, Forex CFDs, Indices CFDs, Metals CFDs, Stock CFDsTrade Responsibly: Derivative products are highly leveraged, carry a high level of risk and are not suitable for all investors. Features of our products including fees and charges are outlined in the relevant legal documents available on our website. The legal documents should be considered before entering into transactions with us.Offering well over 10,000 CFD products across cryptocurrencies, shares, commodities, forex, and indices, FP Markets is undoubtedly one of the natural gas brokers worth considering. By joining the broker’s community, traders will have the chance to trade on one of the world’s largest exchanges and benefit from tight raw spreads starting from 0.00, as well as low commissions.
If traders do not want to focus exclusively on natural gas but are interested in other commodities, they might also add crude oil, silver, gold, platinum, palladium, corn, wheat, or coffee to their portfolios.
The broker also offers a range of account and platform types designed to meet the needs of traders with different levels of experience.
The broker has also taken care of its users when it comes to payments, and adding or removing funds from their accounts is effortless thanks to payment methods such as bank transfer, Neteller, Visa, Mastercard, Skrill, STICPAY, and Rapid Transfer. Cryptocurrencies like Bitcoin, Ethereum, Litecoin, and Dash, along with a number of country-specific payment processors, are also among the featured options. While trading natural gas with FP Markets, traders also benefit from fast, easy withdrawals that, in most cases, cost them nothing.
FP Markets has a long track record – the platform started operating in 2005 – which makes it a broker worth considering for traders who insist on working with a reputable and reliable company. FP Markets is also regulated and authorized by the top-tier Australian Securities and Investments Commission and the Cyprus Securities and Exchange Commission.
- TRADE NOWREAD REVIEWPlatformscTrader, MetaTrader 4, MetaTrader 5, TradingView, ZuluTrade, BlackBull CopyTrader, BlackBull Invest, BlackBull Shares, BlackBull TradeMin Deposit$0 (Standard)$0 (Prime)$20,000 (Institutional)Fees
- No deposit fees
- Cashouts incur fees that are based on the chosen currency
Deposit Methods Commissions- No commission for standard accounts
- $6.00 per lot for ECN prime
- $15 per Million for ECN institutional
SpreadEUR/USD: AVG 0.3 pips, EUR/USD: AVG 1 pips, GBP/USD: AVG 0.3 pips, GBP/USD: AVG 1.2 pips, USDJPY: AVG 0.3 pips, USDJPY: AVG 1.2 pipsWithdrawal Methods Leverage EU1:500 (FMA)Leverage non-EU1:500 (FSAS)InstrumentsCommodities CFDs, Crypto CFDs, Forex CFDs, Indices CFDs, Metals CFDs, Stock CFDsRisk Warning: Trading foreign exchange on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade foreign exchange, you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and, therefore, you should not invest money you cannot afford to lose. You should make yourself aware of all the risks associated with foreign exchange trading and seek advice from an independent financial advisor if you have any questions or concerns as to how a loss would affect your lifestyle. BlackBull Markets does not accept client applications from Canada and the United States.Founded in 2014, BlackBull Markets has evolved into a global online trading platform that has expanded its reach across Africa, Asia, South America, and Europe. The broker is dedicated to providing premium trading conditions, offering leverage of up to 1:500, spreads from as little as 0.0 pips, and access to more than 300 tradable instruments.
Thanks to its worldwide network, traders can access a wide range of markets, including forex, shares, precious metals, indices, and energy. Trading natural gas and oil is exceptionally straightforward, and traders benefit from fast execution, the broker’s low-cost pricing model, and flexible leverage options. The broker has ensured that its users can trade the way they want and, to this end, has provided some of the world’s most renowned platforms, including MetaTrader 4 and MetaTrader 5.
Client satisfaction is a top priority for BlackBull Markets, and to deliver on this promise, the broker offers high-level customer service. Traders can reach the dedicated support team and account managers via email, phone, and live chat almost any time.
BlackBull Markets offers an account type for every trader. Users can choose among Standard, Prime, and Institutional accounts, each with its own minimum deposit requirement, spreads, commissions, and other conditions.
- TRADE NOWREAD REVIEWRegulatorsCONSOB (Italy, # 211), FCA (United Kingdom, # 434413), SCB (Bahamas, # 199667 B), CMVM (Portugal, # 433), FSCM (Mauritius, # GB24203277), CVM (Brazil, # 43050.917/0001-03)PlatformsMetaTrader 4, MetaTrader 5, Proprietary Web, TradingView3. ActivTradesMin Deposit$0Fees
- 0.5% on deposits (EU/EEA cards)
- 1.5% on deposits (non EU/EEA cards)
- $12.50 for bank transfer withdrawals in USD
- £9 for bank transfers in GBP (SCB and FSC entities only)
- A $10 inactivity fee after 50 weeks
Deposit Methods CommissionsNo commissionSpreadEUR/USD: AVG 0.5 pips, GBP/USD: AVG 0.8 pips, USDJPY: AVG 0.5 pipsWithdrawal Methods Leverage EU1:10Leverage non-EU1:400 (CMVM | Pro Account), 1:30 (CMVM | Retail Account), 1:1000 (FSC), 1:200 (SCB)InstrumentsBonds CFDs, Commodities CFDs, Crypto CFDs, ETF CFDs, Forex CFDs, Indices CFDs, Share CFDsCFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 73% of retail investor accounts lose money when trading CFDs with this provider.You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.ActivTrades provides its clients with a wide variety of tradable products, offering more than 1,000 CFD assets across seven markets. All symbols are accessible through several third-party platforms, including MT4, MT5, and TradingView. Alternatively, you can trade via the broker’s proprietary ActivTrader platform.
Commodities are included in the tradable markets, with a range of hard and soft commodities available as CFD instruments. Natural Gas Futures and Natural Gas Spot are also featured, allowing traders to take long or short positions on the price of this energy asset. Order sizes for natural gas range from 0.01 lots to 70 lots, accommodating both high-volume and risk-averse traders.
When trading natural gas CFDs, you won’t pay any commission, as the entire trading cost is built into the spread. The target spread for this energy commodity is 0.005 points, with the value of one point equal to $10,000. Therefore, the target spread for a standard-lot trade is $50.
You can further increase your natural gas exposure by using leverage, which is capped at 1:10 for retail traders in the EU and the UK. Pro account holders can trade the commodity with leverage of up to 1:100, which is also the maximum available to clients registered with the SCB entity of ActivTrades. Those trading natural gas under the FSC-regulated division have access to leverage of up to 1:200.
- TRADE NOWREAD REVIEWRegulatorsCIRO (Canada), CySEC (Cyprus, # 347/17), FRSA (United Arab Emirates, # 190018), FFAJ (Japan, # 1574), FSCA (South Africa, # 45984), FSRA (Canada, # 190018), ISA (Israel, # 514666577), JFSA (Japan, # 1662), ASIC (Australia, # 406684), BVIFSC (Virgin Islands, British, # SIBA/L/13/1049), CBI (Ireland, # C53877)PlatformsAvaOptions, DupliTrade, AvaSocial, MetaTrader 4, MetaTrader 5, AvaTadeGO, Proprietary Web, ZuluTrade4. AvaTradeMin Deposit$100Fees
- $/€/£50 inactivity fee
- No deposit and withdrawal fees
Deposit Methods CommissionsDoes not charge a commissionSpreadEUR/USD: AVG 0.8 pips, GBP/USD: AVG 1.2 pips, USDJPY: AVG 1.3 pipsWithdrawal Methods Leverage EU1:10Leverage non-EU1:400 (Pro Account), 1:30 (Standard Account)InstrumentsBonds CFDs, Commodities CFDs, Crypto CFDs, Crypto Options, Energy CFDs, ETF CFDs, Forex CFDs, Forex Options, Index Options, Indices CFDs, Metals CFDs, Share CFDs, Stock CFDs, Stock Options, US Stock OptionsCFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 71% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.Celebrated for its customer-first approach and the enhanced trading experience it offers, AvaTrade has been a prominent figure in the trading world since 2006. With more than 300,000 satisfied customers and counting, the broker offers a roster of more than 1,000 tradable instruments, including indices, stocks, cryptocurrencies, Forex, and commodities. With AvaTrade, you can gain exposure to a wide range of markets, from metals to energies, including natural gas.
You can trade natural gas on AvaTrade’s advanced platforms, MetaTrader 4 and MetaTrader 5, and even while on the go, thanks to its proprietary platform, AvaTradeGO. While trading natural gas with the broker, users are offered competitive spreads and can trade with leverage of up to 1:10.
To get started with commodity trading, AvaTrade users should first choose one of the accepted payment methods to fund their accounts. The broker offers a quick withdrawal process that takes, at most, one or two working days. Not to mention, when topping up their accounts or withdrawing funds, traders will not incur extra charges.
AvaTrade is worth considering for traders who want to be sure that the broker they choose is heavily regulated, as it is authorized to operate in the EU, Australia, Japan, South Africa, the United Arab Emirates, and elsewhere.
Traders are also offered live customer support in dozens of languages via live chat, over the phone, or via email.
- 5. FBSMin DepositCent accounts: $10; AU$50 (ASIC accounts)FeesNo fees for deposits and withdrawalsDeposit Methods Commissions
- No commission for standard accounts
- 0,05% for opening and 0,05% for closing positions for crypto accounts
SpreadEUR/USD: AVG 0.7 pips, GBP/USD: AVG 1.2 pips, USDJPY: AVG 1.3 pipsWithdrawal Methods Leverage EU1:30 (CySEC)Leverage non-EU1:30 (ASIC), 1:3000 (FSC), 1:500 (Pro Account), 1:30 (Retail Account)InstrumentsEnergy CFDs, Forex CFDs, Indices CFDs, Metals CFDs, Share CFDsRisk warning: ᏟᖴᎠs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76.5% of retail investor accounts lose money when trading ᏟᖴᎠs with this provider. You should consider whether you understand how ᏟᖴᎠs work and whether you can afford to take the high risk of losing your money.With a sterling reputation among traders, FBS is a broker that now serves clients from more than 190 countries worldwide. It is a reliable and trustworthy company with over 10 years of experience and aims to provide the best trading conditions.
FBS offers its users the opportunity to access a range of markets, and trading instruments such as Forex, cryptocurrencies, stocks, metals, indices, and energy products are all within reach. If energy trading is your focus, you can choose between natural gas, WTI oil, Brent oil, and more.
Opening a demo account is the recommended approach for traders taking their first steps in trading natural gas or for those who want to familiarize themselves with the platform without risking their funds. Several other account types are available, and traders can choose a Standard, Crypto, Cent, or Islamic account. FBS provides its users with powerful trading platforms that deliver efficiency and optimized trading speed; in addition to the recently added FBS Trader, the broker also offers MetaTrader 4 and MetaTrader 5.
The broker supports a variety of payment systems, and moving funds to and from FBS is possible via Neteller, Skrill, Mastercard, Visa, Rapid Transfer, wire transfer, and more. Whether depositing or withdrawing funds, traders will not incur extra charges, and even better, payments in both directions are processed in the blink of an eye.
FBS prides itself on its team of highly qualified professionals. Whenever traders have questions or concerns, they can reach the support team via email, live chat, or phone.
- 6. AdmiralsMin Deposit$25Fees
- No deposit fees
- One free withdrawal request per month
- $10 inactivity fee
Commissions- No commission for trading stocks
- The commission that is charged when trading currencies and metals is based upon the account type and the monthly volume
Spread0.006Leverage EU1:10Leverage non-EU1:20Risk warning: Trading Forex (foreign exchange) or CFDs (contracts for difference) on margin carries a high level of risk and may not be suitable for all investors. There is a possibility that you may sustain a loss equal to or greater than your entire investment. Therefore, you should not invest or risk money that you cannot afford to lose. Before using Admiral Markets UK Ltd, Admiral Markets Cyprus Ltd, Admiral Markets AS Jordan Ltd, Admiral Markets Pty Ltd and Admirals SA (PTY) Ltd services, please acknowledge all of the risks associated with trading.Admirals is a top-tier provider of natural gas CFD trading and has been an active player in the online trading scene since 2001. This is a brand name traders might already be familiar with, as the broker has significantly expanded its international footprint through a number of fully licensed trading companies.
To provide its users with the ultimate trading experience, the broker has introduced several trading tools such as StereoTrader. Admirals users looking to enhance their trading experience should consider giving MetaTrader Supreme Edition a try.
The broker knows that the variety of covered markets matters and, to stay relevant, covers stocks, bonds, cryptocurrencies, indices, Forex, ETFs, and commodities, among others. With 28 available commodities, you can trade commission-free 24 hours a day, five days a week, and benefit from competitive leverage rates. Admirals users can gain exposure to several leading energy commodities, including natural gas, Brent oil, and WTI oil, as well as metals and agricultural products.
To meet the needs of all its users, Admirals offers a choice of several flexible account types and a variety of funding options. Traders will also be pleased to learn that they can maintain multiple accounts in different currencies simultaneously.
Admirals provides support via live chat, phone, and email to ensure that there is always someone available to assist with any organizational or technical matters. The broker also excels when it comes to fund security: users receive insurance coverage and negative balance protection, and their funds are kept in segregated accounts.
- 7. IC MarketsMin Deposit$200FeesThe broker does not charge inactivity feesDeposit Methods Commissions
- No commission for standard accounts
- $3.5 per standard lot round turn for raw spread accounts
SpreadEUR/USD: AVG 0.82 pips, GBP/USD: AVG 1.03 pips, USDJPY: AVG 0.94 pipsWithdrawal Methods Leverage EU1:500 (CySEC | Pro Account), 1:30 (CySEC | Retail Account)Leverage non-EU1:1000 (FSAS | Retail Account)InstrumentsCommodities CFDs, Crypto CFDs, Energy CFDs, Forex CFDs, Indices CFDs, Metals CFDs, Stock CFDsRisk Warning: Trading Derivatives carries a high level of risk to your capital and you should only trade with money you can afford to lose. Trading Derivatives may not be suitable for all investors, so please ensure that you fully understand the risks involved and seek independent advice if necessary.IC Markets has evolved into one of the most prominent and largest CFD providers by giving traders everything they might be looking for in their trading experience. The broker offers instant account opening and funding, and gives traders the chance to trade a number of markets, including Forex, indices, commodities, bonds, stocks, and cryptocurrencies.
Traders can choose from a diverse range of commodities; energy, metals, and agricultural products are all covered. In addition to natural gas, IC Markets users can also trade Brent oil and WTI oil and benefit from tight pricing and flexible lot sizes.
IC Markets offers state-of-the-art trading platforms, and, along with MetaTrader 4 and 5, traders are also presented with cTrader. Additionally, IC Markets users gain access to a number of cutting-edge trading tools, including ladder trading, inbuilt spread monitoring, automated trade closing with custom order templates, and depth of market, to name a few.
The broker has given much thought to users who want to start trading natural gas or those who want to brush up on their knowledge, as the education center contains webinars, podcasts, and video tutorials that will help them achieve their goals.
Traders can have full confidence that the broker is monitored by some of the most stringent regulators across the globe, as it is authorized by the FSA, SCB, ASIC, and CySEC. IC Markets is available in more than a dozen languages, and traders are offered around-the-clock assistance via email, phone, or live chat.
- TRADE NOWREAD REVIEWRegulatorsCNMV (Spain, # 40), CySEC (Cyprus, # 169/12), DFSA (United Arab Emirates, # F006316), FCA (United Kingdom, # 522157), FSCA (South Africa, # 49970), FSAN (Norway, # FT00118162), IFSC (Belize, # 000302/11), KNF (Poland), BaFin (Germany)PlatformsxStation 58. XTBMin Deposit$250Fees
- Inactivity fee of €10 or the currency equivalent
- 2% for deposits via Paysafecard
- 1% for deposits via Neteller
- 1.5% for deposits via SafetyPay
Deposit Methods Commissions- No execution commission for standard accounts except for ETF trades and equity CFDs
- Pro account type holders will pay a commission for every trade, and it will vary depending on the country they live in
SpreadEUR/USD: AVG 0.9 pips, GBP/USD: AVG 2.2 pips, USDJPY: AVG 1.4 pipsWithdrawal Methods Leverage EU1:200 (CySEC | Pro Account), 1:30 (CySEC | Retail Account), 1:30 (FCA | Retail Account)Leverage non-EU1:500 (IFSC | Retail Account)InstrumentsCommodities CFDs, Crypto CFDs, Energy CFDs, ETF CFDs, Forex CFDs, Indices CFDs, Metals CFDs, Share CFDs, Stock CFDs, US Stock CFDsContracts for Difference ("CFDs") are leveraged products and carry a significant risk of loss to your capital, as prices may move rapidly against you and you may be required to make further payments to keep any trades open. These products are not suitable for all clients, therefore please ensure you fully understand the risks and seek independent advice.Established in 2002, XTB became the very first leveraged foreign exchange brokerage house in Poland. Since that time, the broker has remained at the forefront of the online trading world, providing retail traders with hassle-free, instant access to hundreds of global markets.
XTB’s product offerings include a wide variety of markets such as Forex, indices, cryptocurrencies, stocks, ETFs, and commodities. If you decide to switch to XTB to trade commodities, you can trade popular options such as silver, gold, oil, and natural gas, among others. If natural gas trading is what excites you most, you will benefit from commission-free trades and a maximum leverage of 1:10, while the minimum spread is just 0.004.
Traders can get a feel for the services the broker offers without risking anything, as once they set up an account, they can use the platform free of charge for 30 days. Regarding the broker’s platform suite, XTB currently offers only xStation 5 and xStation Mobile. What distinguishes the platform XTB has introduced is its intuitive and simple design, the wide variety of trading instruments it supports, and the advanced tools traders can access on their desktop devices or hold in the palm of their hands.
XTB gives its users the opportunity to trade on world-class platforms that are customizable, offer superior execution speeds, and provide sentiment indicators, performance statistics, a calculator, market order depth, and chart trading, to name a few.
The broker also excels in customer service. In addition to the wide variety of languages in which traders can receive assistance, XTB has ensured that its users can reach the support team in the manner most convenient for them.
- 9. TickmillMin Deposit$100Fees
- No deposit and withdrawal fees
- No inactivity fee
Deposit Methods Commissions- 2 currency units per side per lot commission for Pro account
- 1 currency unit per side per lot commission for VIP accounts
SpreadEUR/USD: AVG 1.7 pips, EUR/USD: AVG 0.1 pips, GBP/USD: AVG 1.9 pips, GBP/USD: AVG 0.3 pips, USDJPY: AVG 1.7 pips, USDJPY: AVG 0.1 pipsWithdrawal Methods Leverage EU1:500 (CySEC | Pro Account), 1:500 (FCA | Pro Account), 1:30 (CySEC | Retail Account), 1:30 (FCA | Retail Account)Leverage non-EU1:1000 (FSAS)InstrumentsBonds CFDs, Commodities CFDs, Crypto CFDs, Forex CFDs, Indices CFDs, Stock CFDsRisk Warning: Trading financial products on margin carries a high degree of risk and is not suitable for all investors. Losses can exceed the initial investment. Please ensure you fully understand the risks and take appropriate care to manage your risk.Tickmill was founded in 2014 and started making waves from the very beginning of its operations. With 270,000 satisfied clients and counting, it is safe to say that the broker knows how to maintain its popularity and the appeal of its services.
The market variety is undoubtedly one of the keys behind Tickmill’s enormous success, and, with 180 instruments and counting on offer, traders are bound to find their preferred market. The instruments traders will gain access to upon registration include precious metals, stocks, cryptocurrencies, bonds, stock indices, and oil. Traders who prefer to focus on natural gas are offered a maximum spread of 1:50, while spreads vary between 0.001 and 0.004.
Tickmill allows its users to gain exposure to the world’s financial markets using the strategy they prefer, as they can opt for hedging, scalping, and EAs, among others. The broker takes pride in its ultra-fast execution times, superior trading conditions, and exceptionally low commissions – features that make worthwhile brokers stand out from the crowd.
The broker keeps traders covered, no matter their style or level of experience, as there is an account type that meets the needs of VIPs, as well as accounts suitable for complete novices and professional traders alike. The broker relies on some of the world’s most popular trading platforms, including MetaTrader 4 and MetaTrader 5, and, as a result, traders will gain access to customizable charts, integrated indicators, CFDs on all covered markets, trading signals, advanced technical analysis, and all types of trade orders.
Traders should not lose sleep over the broker’s reliability and trustworthiness, as Tickmill is authorized by CySEC, the FCA, the FSCA, and the FSA, among others.
- 10. XtradeMin Deposit$250, $500, $1,000, or $20,000 depending on the account typeFees
- No deposit and withdrawal fees
- Up to $50 inactivity fee per month
CommissionsNo commissionSpread0.13Leverage EU1:10Leverage non-EU1:150CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 67.1% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Past performance is not a guarantee of future performance. Xtrade Europe Ltd is regulated by Cyprus Securities and Exchange Commission (“CySEC”).With more than a decade in operation, Xtrade has been providing users in over 20 countries with market-leading trading services. The broker is dedicated to building the highest level of trust and goes out of its way to keep traders’ funds well protected. Xtrade continuously monitors user activity, encrypts all transactions with 256-bit SSL, keeps client funds in segregated accounts, and offers an investor compensation fund, ensuring that the trading experience remains smooth and worry-free.
Traders gain access to a wide range of products, including shares, indices, cryptocurrencies, bonds, ETFs, and commodities. Xtrade’s commodity selection features natural gas, crude oil, silver, gold, wheat, cotton, and coffee, to name a few. When you trade natural gas CFDs, you can take advantage of lightning-fast execution and leverage of up to 1:200.
Another reason Xtrade stands out as a natural gas trading platform is the availability of special deals for both new and returning users. Support agents are always available to assist and guide traders with bonus redemption or any other aspect of their trading experience.
The broker continues to gain international acclaim for the best-of-breed technology it employs, and its platforms are available both on the web and on mobile devices. Thanks to the Xtrade mobile trading app, users have the freedom to trade natural gas or access any other market from anywhere in the world.
Formed deep beneath the earth’s surface, natural gas is a naturally occurring hydrocarbon used in many industries. It is one of the most attractive fuels because it is abundant, relatively inexpensive and the cleanest of all fossil fuels. It is a staple resource used in heating, cooking and electricity generation, to name a few, and the number of vehicles powered by natural gas already exceeds 20 million.
Natural gas is drilled from the ground as it often exists alongside oil reserves, and, owing to technological advancements in extraction methods, production has increased massively in recent years. As with other energy commodities, large price swings are observed in the cost of natural gas. These rises and falls are dictated mainly by supply and demand, as well as traders’ expectations. Natural gas is not as rare as some other energy commodities, but creating the infrastructure needed to exploit it is costly.
Undoubtedly, oil is the energy commodity most traders tend to focus on. Still, it is far from the only option available when they are looking to keep their portfolios diversified.
How natural gas trading works for traders and brokers
Natural gas is an in-demand commodity, favoured for the wide range of trading opportunities it presents. The rapid development the industry has experienced since 2006 has created numerous avenues for traders seeking market exposure: they can trade futures contracts, focus on the share prices of transport companies and natural gas producers, among others.
Regarding global natural gas production, figures show that in 2021 the USA led the way. Russia was the second-largest contributor, yet it holds the largest proven natural gas reserves and is also the world’s leading exporter.
- Futures – futures contracts are one of the most popular ways to take a position on natural gas. They are agreements to buy or sell the commodity at a specified future date. On futures exchanges, the natural gas price fluctuates in $0.001 increments. Profit or loss is therefore determined by how many increments – or ‘ticks’ – the price moves away from the entry point.
- Options – options are financial instruments used when trading stocks, currencies, bonds and commodities, and they allow traders to leverage their exposure to natural gas or any other underlying asset. As with all options, a put represents a short position, while a call represents a long position. Traders should bear in mind that various factors can fuel market volatility, making options trading more challenging.
- Spots – natural gas spot trades are settled immediately and do not rely on futures contracts. They are based on the current market price and tend to be far more volatile than futures, a volatility that often reflects the greater uncertainties surrounding physical delivery.
- ETFs – another way to trade natural gas is through exchange-traded funds. This approach spares traders the storage costs associated with holding physical commodities and avoids the complexities of natural gas futures contracts.
CFDs – contracts for difference are agreements between brokers and traders that mirror the price movement of natural gas. CFDs allow traders to speculate on the price of the underlying asset without owning the physical commodity, and the aim is to profit from the difference between the opening and closing prices of the trade. Traders favour natural gas CFDs because they provide market exposure regardless of whether they expect the price to rise or fall, allowing them to attempt to benefit from both upward and downward movements.
Because CFDs are traded on margin, leverage enables traders to control positions larger than the funds they have deposited. However, this also means that losses can exceed the initial deposit.
Another vital point to remember is that, in exchange for executing buy or sell orders, brokers charge a fee known as a commission. Depending on the broker, not all actions on the platform are fee-free, and extra costs may be incurred when funding accounts, withdrawing funds or remaining inactive for a period.
Why natural gas prices move
Natural gas is increasingly popular among traders, largely because its seasonal price fluctuations can be relatively easy to anticipate. As with other energy commodities, supply and demand are the key forces that drive prices up or down. In turn, supply and demand are influenced by multiple factors, including weather, alternative fuels, stored reserves, extraction and treatment, among others.