Experts fear oil price may deflate in line with gas

Gas has performed worse than any other exchange-traded commodity this year, raising concerns that oil, its big brother, could have further to fall.

While crude is 39 per cent higher than at the start of the year, gas on the New York Mercantile Exchange (NYMEX) has fallen 36 per cent, with many observers believing that it will head lower.

Data from the US Commodity Futures Trading Commission show that the world’s biggest hedge funds have collectively purchased US$5.8 billion of derivatives that will be in the money if gas prices fall – their largest position against NYMEX gas futures in seven months.