GUERNSEY Shows the Fall of EnronOnline Affects Natural Gas Trade.Business Editors & Energy Writers OKLAHOMA CITY--(BUSINESS WIRE)--Oct. 8, 2002 A study of natural gas prices at ten U.S. trading hubs conducted by Drs. Zhen Zhu and Donald Murry, economists at C. H. Guernsey & Company, has shown a decline in informational efficiency Informational efficiency The speed and accuracy with which prices reflect new information. Informational efficiency The degree to which market prices correctly and quickly reflect information and thus the true value of an underlying asset. since the collapse of Enron and the closing of the EnronOnline Internet-based trading platform. Informational efficiency is a measure of a market's ability to incorporate information into prices. In the gas markets, it also is a measure of the ease with which arbitrage communicates price changes among trading hubs and within the futures market futures market, a commodity exchange where contracts for the future delivery of grain, livestock, and precious metals are bought and sold. Speculation in futures serves to protect both the developers and the users of the commodities from unfavorable and unpredictable . Using two separate statistical techniques, the economists' analysis concluded there was a decrease in the randomness of prices, an increased separation between the spot and futures prices Futures price The price at which parties to a futures contract agree to transact upon the settlement date. and a diminished overall market efficiency associated with the decline in informational efficiency. Zhu presented the findings of the study at a meeting of the International Association of Energy Economists in Vancouver, British Columbia British Columbia, province (2001 pop. 3,907,738), 366,255 sq mi (948,600 sq km), including 6,976 sq mi (18,068 sq km) of water surface, W Canada. Geography on Oct. 8, 2002. Zhu revealed that EnronOnline, during its existence from November 1999 until November 2001, served as a market shaper and a price leader, and during this period, the measures of informational efficiency improved over levels from prior periods. "Because of its central role in the market, it is not surprising that the closing of EnronOnline, which accompanied Enron's bankruptcy, should impact the functioning of the natural gas markets," Zhu said. The economists also evaluated how price volatility changed from the period prior to the entry of EnronOnline, during its existence and since its demise. Although they determined the collapse of Enron sharply increased price volatility, this impact was short-lived. Their analysis showed the indices of price volatility at the ten trading hubs and in the futures market returned and remained at prior levels after approximately two weeks. More information about natural gas storage and its affects on the nation's economy can be accessed at www.chgeconomics.com. C. H. Guernsey & Company offers high-quality engineering, architectural and consulting services Noun 1. consulting service - service provided by a professional advisor (e.g., a lawyer or doctor or CPA etc.) service - work done by one person or group that benefits another; "budget separately for goods and services" to clients in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. and abroad. The firm has provided innovative solutions for over 74 years. GUERNSEY has its headquarters in Oklahoma City Oklahoma City (1990 pop. 444,719), state capital, and seat of Oklahoma co., central Okla., on the North Canadian River; inc. 1890. The state's largest city, it is an important livestock market, a wholesale, distribution, industrial, and financial center, and a farm with offices in Amarillo, Texas “Amarillo” redirects here. For other uses, see Amarillo (disambiguation). Amarillo is the 14th-largest city in the U.S. state of Texas and the seat of Potter County. ; Atlanta; Dallas; Honolulu; Tulsa, Okla.; Rock Island, Ill.; and Tallahassee, Fla. |
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