OMAHA, NE – Once again, it appears the Oracle of Omaha has found a diamond in the rough, a needle in a haystack, gold in the hills, and a money tree in the NYMEX (New York Mercantile Exchange).
Two years ago as nearby natural gas futures on the NYMEX fell to their lowest price in more than two decades, Warren Buffet’s Berkshire Hathaway purchased the Dominion Energy natural gas pipeline and transmission assets for $10 billion.
Between June 2020 when the price of natural gas fell to $1.44 MMBtu (One Million British Thermal Units) and on Monday afternoon Henry Hub prices for July contracts gained more than 9.9 percent on the day to settle at $9.368.
The runup in prices is attributed to tight supplies, increasing global demand – as a replacement for Russian-supplied energy to Europe, and the projection of a hot and dry summer in Texas which would lead to even greater demand for gas-fired electrical plants.
At the end of the day, the price tag Buffet paid for Dominion Energy appears to be a bargain and a potential windfall into 2023.
(SOURCE: All Ag News)
