After an unparalleled fall, natural gas prices could double by next year, as a growing number of idle rigs create a supply crunch.

Natural gas prices have tumbled by about 30% this year, as a steep drop in industrial consumption has undermined demand. However, many of the traders and hedge funds that placed speculative bets on the price decline are beginning to reverse course and bet on a price spike, as dwindling production is starting to outpace slumping demand.

Traders trimmed their net short positions on gas by 11% to 114,064 in the week ended March 10, the smallest since last July, Bloomberg News reported. Also, natural gas futures for delivery in January 2010 are trading at a 49% premium to the April contract, which means speculators are anticipating a price surge.

In its short-term energy outlook - released on March 10 - the Energy Information Administration said

Japan’s exports were cut nearly in half last month as the global downturn crushed demand for the country’s electronics and automobiles, a development that increases the odds that the Japanese yen could be poised for a tumble.

Japanese exports fell by 45.7% in January from a year ago - the steepest decline since 1957 - as exports to three of Japan’s biggest overseas markets fell by record levels. Exports to the United States fell by 52.9%, exports to Europe declined by 47.4%, and exports to Asia dropped by 46.7%, Japan’s Ministry of Finance reported.

The sharp drop in exports has had a crushing impact on Japan’s trade deficit, which grew for a fourth straight month to a record $9.84 billion (¥952.6 billion). But the impact on the nation’s leading corporations has been even more devastating.&

Many Japanese blue chips, such as Toyota Motor Corp. (ADR: TM) and Sony Corp. (

President-Elect Barack Obama headed to Capitol Hill yesterday (Monday) to meet with House and Senate leaders to push for quick action on his broad economic stimulus package that could cost as much as $775 billion. 

But in a concession to his need for bi-partisan support to pass any package, Obama promised “radical reforms” to impose more control over the federal budget in the future, The New York Times reported.

Republican leaders have already started voicing criticism of the recovery plan, offering their own ideas about what it should contain. Obama aides hope to soften the perception of the plan as an “open checkbook” by focusing more on tax cuts than on spending.

To firm up support among Congressional skeptics worried that Obama was too focused on government spending, Obama’s team revealed the package will devote about 40% to tax cuts, costing roughly $150 billion. The package will

Will November’s emergency global financial summit result in a “new global financial order”? European leaders are pressing for a fundamental change in the US-centric monetary system. Jason Simpkins says a similar crisis meeting in 1944 gave birth to the Bretton Woods gold standard. But there are reasons to doubt such a major reform this time around.

This from Money Morning:

The leaders of 20 of the world’s most developed nations, the G20, will convene in Washington D.C. on Nov. 15 for an emergency financial summit considered by many to be the 21st century version of the Bretton Woods initiative of 1944. This will be the first chance for European leaders – many of whom blame the current financial contagion on U.S. free market capitalism run – to press for an overhaul of a global financial system the United States has dominated for more than 60 years.

The summit will