Natural gas this week and UNG: contango fights backwardation, bad for UNG

As readers know we follow the contango situation closely as it deeply affects UNG prices. Rollover will commence for UNG in 2 days, so this will greatly influence whether UNG loses or gains contracts.

(Please see UNG Rollover dates for 2011).

Here is the current situation with contango and  backwardation as of this morning:

There is almost no contango or backwardation from February to March, then a very small backwardation until April contracts, but then contango is back. So for this month, as of this morning, UNG is safe, but the backwardation that we had been seeing has evaporated. Anyone investing in UNG should pay very close attention to this.

Please compare with last week (January 4):