Analysis Paper 1 During this winter the price of natural gas has gone through the roof. This brings many questions to mind. Are the companies just raising prices? Is there actually a shortage that is causing the raise in price? It turns out that the market for natural gas is a very competitive one and that there is in fact a shortage in supply that is causing the price to increase. Natural gas must be drilled …showed first 75 words of 453 total…

…showed last 75 words of 453 total…gas was used so they did not store as much for this year. If however the companies had high inventory levels the price would be lower because the supply would be greater than the demand. If the quantity supplied were higher then the price would be lower at the same demand. Then when demand increased the raise in price would not be as great as it was this winter because the inventory was so low.