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What are Pricing Benchmarks?
Pricing Benchmarks, or indexes, are determined by Price Reporting Agencies to monitor the current market price for various commodities, including energy, metals and agricultural products. Such prices are used by the physical market to purchase and sell natural gas, by the financial markets as the underlying price for derivative contracts, by the midstream market to provide “cash-out” prices to balance natural gas systems, by state public utility commissions to adjudge the “prudency” of gas purchases by regulated utilities, and by the analyst community to gauge the strength of commodity supply and demand. Natural Gas Intelligence was the first PRA to establish natural gas pricing benchmarks in North America, which we have been doing since 1983.
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