In the previous article, I discussed the global nature of the oil markets. But the shale oil boom in the U.S. temporarily increased the localized impact on the West Texas Intermediate (WTI) benchmark. As a result, its price diverged from that of international crudes for a few years. The natural gas markets, on the other hand, are far more localized due to the difficulty in transporting natural gas. That means that natural gas in the U.S. could be $3 per million British thermal units (MMBtu), but double or triple that level in Japan or Europe. Natural gas production in the U.S. has exploded since the beginning of the shale gas boom. From 2005 to 2015, U.S. dry natural gas production increased by 50 percent. Natural gas prices fell in response. From 2005 to 2008, annualized natural gas prices hovered in a range from just under $7/MMBtu to nearly $9/MMBtu. […]