ProShares Ultra Bloomberg Natural Gas (NYSE:BOIL) is surging Monday afternoon as U.S. natural-gas futures rally on Winter Storm Fern. Here’s what investors need to know.
Natural Gas Prices Skyrocket On Extreme Cold
Front-month Henry Hub contracts have vaulted above $6 per MMBtu, up more than 30% Monday and 125% in four sessions, the largest weekly gain ever for a Nymex natural-gas contract.
Record cold, heavy snow and catastrophic ice are boosting heating demand just as freeze-offs threaten up to 15 billion cubic feet per day of output, creating near-term deliverability risks and the prospect of record storage withdrawals.
The storm has cut power to 1 million customers and doubled wholesale electricity prices, underscoring grid stress. Fern is also disrupting travel and drawing attention to natural-gas producers and pipeline operators.
What Is The BOIL ETF?
BOIL is a leveraged exchange-traded fund targeting twice the daily return of an index tied to front-month U.S. natural-gas futures. It uses Nymex Henry Hub futures and resets its leverage each day.
BOIL is designed for short-term trading; over longer periods, compounding, volatility and futures-roll costs can make its performance diverge sharply from spot gas.
Why BOIL Jumps On This Weather Shock
When front-month gas futures surge on cold-weather demand and supply disruptions, BOIL's 2x leverage magnifies the move, making the fund a high-octane way to trade the natural-gas price spike.
BOIL ETF Surges Monday
BOIL Price Action: ProShares Ultra Bloomberg Natural Gas shares were up 11.80% at $31.64 at the time of publication on Monday, according to Benzinga Pro data.Image: Shutterstock
