Why have natural gas prices soared so high in California? On today’s episode of THE FINANCIAL COMMUTE, host Chris Galeski invites Managing Director of Investments Sasan Faiz to answer this question so many Californians are concerned about. 

This winter has been colder than usual in California, causing the demand for natural gas to increase. California gets most of its natural gas from other states like Texas, and supplies have been constrained there due to pipeline maintenance. High demand and low supply generally cause prices to skyrocket. 

Will prices continue to increase? Sasan expects energy prices to swell going forward as China opens up and uses more energy. There have also been less investments in new rigs for oil and gas, causing decreased capital expenditure and limited supply. Heightened prices may not be exclusive to natural gas, as Sasan says inflation in general will continue to climb due to deglobalization and the transition from traditional to renewable energy. There will be more demand for industrial metals than before, leading to higher commodity prices and an inflationary regime. 

To invest against this environment of high inflation, Sasan advises investors to consider focusing on private credit with floating interest rates and natural resources/industrial metals.

Disclosure: Information presented herein is for discussion and illustrative purposes only. The views and opinions expressed by the speakers are as of the date of the recording and are subject to change. These views are not intended as a recommendation to buy or sell any securities, and should not be relied on as financial, tax or legal advice. You should consult with your financial, legal, and tax professionals before implementing any transactions and/or strategies concerning your finances.