oil and nat gas price predictions
this guy comes on the radio in houston each weekend and makes a next week prediction. he is pretty much spot on. I reccommend following his weekly report.
http://www.texasenergyanalyst.com/
But then, i read this:
Energy Industry Icon Re Affirms Oil and Natural Gas Prices will Correct to Downside; Recommends Investors Go to the Sidelines Quickly
MIAMI, Sept. 13 /PRNewswire-USNewswire/ -- Karl W. Miller, a senior energy executive and institutional investor, today issued the following statement through his advisor VBCC, regarding the state of the U.S. Equity Markets and the Energy Industry.
Mr. Miller recently issued a sell recommendation on the US Natural Gas producers, and called for Natural gas to trade below $3 mmbtu in the U.S. last week.
Mr. Miller re affirms expectations for natural gas to correct to the $2.50 to $2.75 mmbtu price range and will continue getting cheaper, as there are no sustainable demand drivers.
Thus, the natural gas pipeline, master limited partnerships (MLP's) and natural gas producers will suffer substantially reduced earnings during the next 6-8 quarters and are substantially overvalued at the current time.
The Coming Gas Deliverability Crisis
Mr. Miller recommends that the sidelines are the best placement of capital at the current time. The real buying opportunity will come, but now is not the time.
But then i listened to financialsense.com: http://www.financialsense.com/fsn/main.html
and Bill Powers commenting on newshour, exclaims that nat gas prices are very soon to easily jump to $6 and even double digit prices next year. Then Bill Powers releases an editorial titled :http://www.financialsense.com/editorials/powers/2009/0909.html
:
of course Mr. Miller could be looking at short term, while Mr. Powers is looking at long term. But i am curious about these predictions. will nat gas fall and then rebound? or has it bottomed and is about to rebound?
http://www.texasenergyanalyst.com/
But then, i read this:
Energy Industry Icon Re Affirms Oil and Natural Gas Prices will Correct to Downside; Recommends Investors Go to the Sidelines Quickly
MIAMI, Sept. 13 /PRNewswire-USNewswire/ -- Karl W. Miller, a senior energy executive and institutional investor, today issued the following statement through his advisor VBCC, regarding the state of the U.S. Equity Markets and the Energy Industry.
Mr. Miller recently issued a sell recommendation on the US Natural Gas producers, and called for Natural gas to trade below $3 mmbtu in the U.S. last week.
Mr. Miller re affirms expectations for natural gas to correct to the $2.50 to $2.75 mmbtu price range and will continue getting cheaper, as there are no sustainable demand drivers.
Thus, the natural gas pipeline, master limited partnerships (MLP's) and natural gas producers will suffer substantially reduced earnings during the next 6-8 quarters and are substantially overvalued at the current time.
The Coming Gas Deliverability Crisis
Mr. Miller recommends that the sidelines are the best placement of capital at the current time. The real buying opportunity will come, but now is not the time.
But then i listened to financialsense.com: http://www.financialsense.com/fsn/main.html
and Bill Powers commenting on newshour, exclaims that nat gas prices are very soon to easily jump to $6 and even double digit prices next year. Then Bill Powers releases an editorial titled :http://www.financialsense.com/editorials/powers/2009/0909.html
:
of course Mr. Miller could be looking at short term, while Mr. Powers is looking at long term. But i am curious about these predictions. will nat gas fall and then rebound? or has it bottomed and is about to rebound?
Views: 231
Replies to This Discussion
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Permalink Reply by Skip Peel - Mineral Consultant on -
Hate to see the Northeast have a Hard Winter but it sure would help nat gas prices. The heaters should already be on up north. It was 42 degrees this morning in central Arkansas.
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Permalink Reply by David on
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What the general public does not understand is that even with all the surplus, prices are very sensitive to demand. Especially if this demand looks as if it may continue for a number of years if the cooling causation is accurate.
And thinking of how rapid the decline is in shales like the HS, it could prove to be very, very interesting over the next 5-10 years. Your thoughts on this?
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Permalink Reply by Skip Peel - Mineral Consultant on
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Numerous articles from leading industry tracking publications have postulated that the ability to adjust supply to demand will be greatly enhanced once national nat gas production from shale gas nears 50%. The high decline rate of shale gas wells will allow for quicker reductions in supply by curtailing drilling. That makes sense with the exception of the requirement to HBP leasehold that must be drilled to maintain leases nearing expiration. Many shale plays are in their infancy and involve significant acreages with no previous exploration and production and therefore a small percentage of acres HBP'ed. Much of the highly prospective shale gas acreage lies outside of existing field designations. Each shale play will have to go through a period of required development until the majority of prospective acreage is HBP'ed. Once that point is reached, the theory of shale gas decline curves controlling supply and thus price will be put to the test. It would be a benefit to producers and users to have a reasonably stable price structure. If shale gas can accomplish that, nat gas may finally receive the prominence it deserves in national energy policy.
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Permalink Reply by JeffNParis on
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Skip,
In relation to talk of decline curves...a friend told me yesterday that the well operators open the nat gas wells and let them flow at full capacity for three months to clean them out. Then they choke them back to 2.0 for longevity. Is that how they work? How does that affect the decline curve? Would that make for more consistent revenue over the life of the well?
Jeff
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Permalink Reply by Skip Peel - Mineral Consultant on
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Jeff. That's at odds with what I have heard. The best HA wells are in areas where the formation is over-pressured. That's why many members are not just interested in the Initial Production (IP) but in the Flowing Pressure (FP). If you let a well with high pressure flow wide open, there are several things that can happen that are quite bad. One, the formation can be damaged causing near well bore permeability problems. Two, the proppant (usually sand) can be forced out of the formation and back up the well bore causing reduced permeability and damaging the well head. Chokes have 1" orifices and are adjustable in 64ths. of an inch. A 32/64 is equal to a half inch opening. As every well has varying Flowing Pressure, each will produced on the appropriate choke. And wells can be choked back greater than their optimal flow because of restricted capacity in gathering systems or transmission pipelines.
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Permalink Reply by JeffNParis on
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Thanks Skip. I'm learning a lot!
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Permalink Reply by WVLandOwner on
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Being from the northeast, we are hoping for a "hard winter" also. I own land in DeSoto with a well waiting for production, but my job here also depends on coal. A cold winter will help coal also.
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Permalink Reply by red rider on
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Nostradamus? he seems to go by Petrodamus. nonetheless, he made another release today. 29 sept 09, Predictions
Here we publish the weekly Oil and Natural Gas market commentary and predictions that we make on the Sunday
Energy Week show. This page will be updated nearly every day with new energy market news and data.
During hurricane season, please check here daily for hurricane updates at the bottom of this page.
Sept 29, Energy News and Predictions:
Energy Market Insight -- Written by Alan Lammey -Tuesday, Sep 29, 2009
More hedge fund "window dressing" to wrap up the third quarter helped to keep November gas futures aloft, as funds gunned for profits and high water marks to ensure hefty bonuses. In spite of slack shoulder-month demand and record high inventories, prices still managed to lock in a close that will keep the bulls in the game. Based on today’s ending, prices appear poised to test the $5 area..
All of the markets have some challenges ahead, because historically October is a bad month for equities. Plus, we’ve got some new GDP readings coming out, which could show another contraction, along with new unemployment data. If you combine that with the most bearish supply fundamentals the gas market has ever seen, it’s hard to think that gas prices can remain at these levels without another sizeable correction.
* * *
Working gas inventories will hit a new record this week when the Energy Information Administration makes its report Thursday for the week ended Sep. 25. Bentek Energy pipeline data suggests a net storage injection in the middle of a 57 Bcf to 67 Bcf range, which would take inventories above 3,580 Bcf, surpassing the previous 3,567 Bcf record with five weeks left in the refill season. Inventories have already hit new records in the West and Producing regions and is 87 Bcf shy of the East Region record. The EIA reported an 87 Bcf build last year. The five-year average build is around 68 Bcf.
* * *
Nymex November gas futures gained 4.5¢ to close at $4.875/MMBtu. Prices opened slightly lower at $4.82 and then blasted off to an intraday high of $4.975 before sellers began capturing profits. Persistent selling sent prices tumbling to an intraday low of $4.598 before market bulls clawed their way back up to close prices near technically significant resistance at the end of trading. Traders said one key reason that November gas futures regressed sharply in earlier trading was because the United State Natural Gas Fund, the largest exchange-traded fund for the fuel, found few buyers for its release of additional shares, delaying the fund’s anticipated return to the market.
Technical indicators for November gas are mixed. On the upside, key resistance is seen at $4.975, while $5.05 and $5.18 are the next upper objectives. On the downside, key support is seen at $4.598, while $4.505 and $4.337 are considered major areas of support. If violated, look for sellers to test $4.195 and $4.035.
* * *
Nymex November crude oil futures dipped 13¢ to close at $66.71/bbl. Crude oil dropped as the US dollar rose to a two-week high against the euro, limiting the appeal of commodities as an inflation hedge, and amid forecasts fuel inventories will rise. Since February, oil futures have almost doubled as the dollar declined 17% and rising equity markets have supported investor confidence. However, consumer confidence is another matter. The Conference Board released a report today showing that the consumer confidence index fell to 53.1 in September. That was down from 54.5 in August and much lower than the 57 reading economists were expecting.
Technical indicators for November crude remain mixed to bearish. On the downside, key support is seen at today's low of $65.82, followed by $65.41 and $65.05. If the latter is violated, it wouldn’t be out of the question to see sellers test the $64.96 mark, followed by $63.35 and $62.76, while $58.32 is considered longer term major support. On the upside, key resistance is seen at today’s intraday high of $67.33, followed by $68.77 and $71.81. If the latter is violated, look for a test of $72.66, while $73.36 and $75 are the next major resistance areas.
Expectations for Wednesday's inventory reports are: crude oil, up 2.0 million barrels; motor gas, up 1.0 million barrels; distillates, up 1.2 million barrels.
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little copy and paste and here you have his calls again:
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Permalink Reply by Jon Williamson on
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Hello Robert
We would prefer your words of wisdom as opposed to cut and paste......seems trollish not to mention boring!
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Permalink Reply by red rider on
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i am cutting and pasting to share other persons perspective. It may be boring to you, to which i could give a rats azz, yet the information provided is important to other people besides you and only you! I am only sharing information, take it as you wish. this information is worth mentioning, your opinion is not!
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