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Shale gas price hedging: a cash machine at stake? / Pierre-Adrien Ludwig, Mines ParisTech, EU Energy policy blog, 17/04/2011http://www.energypolicyblog.com/2011/04/17/shale-gas-price-hedging-a-cash-machine-at-stake/The fast development of shale gas has revolutionized the American  natural gas market; shale gas production now represents more than 20%  of the domestic consumption. Meanwhile, natural gas prices dropped: the  NYMEX price now stagnates around $4/MMBtu from $12 in June 2008. How is  it possible to ensure a fast-increasing and profitable production at  such prices? Part of the answer is that producers were actually paid a  much higher price, thanks to hedging strategies on commodity markets.  But now, pessimistic market expectations make it harder and harder to  benefit from this mechanism, putting an important share of this  capital-intensive industry’s cash resources at risk...