Although I don't necessarily agree that energy stocks "are the buy of a lifetime", these are more very good "dodging bullet" comments from others:
finance.messages.yahoo.com
Pre-Rita, these were some of the reports:1) 5 billion cubic feet per day of natural gas processing plant capacity was knocked out of service by Katrina; 2)”the MMS said it will probably take three months or more for Gulf Coast production to resume 90% of its capacity”; 3) “damage to important platforms and pipelines will probably eliminate 75 billion to 200 billion cubic feet of supplies from U.S. markets in 2006,” according to Jeffries, “so domestic gas storage will likely peak at 3.05 trillion to 3.15 trillion cubic feet on Oct. 31, leaving the U.S. market tighter going into winter”; 4) “Shell reports that approximately 40% of its Gulf of Mexico production will not be restored until 2006”; 5) “Over the past month, over 33 million barrels of oil -- or about two days of U.S. consumption -- has been shut-in. Natural gas producers have been unable to produce about 156 Bcf, equivalent to about three days of domestic demand.” Another 5 rigs missing as a result of Rita, in addition to those lost as a result of Katrina, and more reports of severe platform damage and refinery damage.
And yet the media has been reporting that the energy complex “dodged the bullet.” One wonders what planet these people are living on, and one can only be amazed at their energy ignorance, and dismayed at the govt’s inability to speak the truth to the American people on what this all means. Our industry could not afford to lose one more Gulf rig or platform. It could not afford to have one more refinery shutdown, not one more processing plant water logged. Media conclusions that 125 mph winds plowing through the most densely populated drilling area of the Gulf would result in little harm to the energy complex was the height of reporting ignorance. A 6-year-old boy could do better. The irresponsible posting on this and other boards that the result of all of this would be the end of the oil and gas bull market was certifiably crazy. If these were paid badgers, they did a lousy job and should be summarily fired.
Forget the pundits of demand destruction. I sarcastically noted in a recent post that our solution to lost supply would be to pledge to eliminate an equivalent amount of demand for every mcf of supply being destroyed by our “Hurricane Carters.” Impossible! Reread the first paragraph and contemplate how much demand destruction that would mean, and paragraph one nowhere near sums up the mathematical loss of supply that has occurred. We must now import more than ever, and higher imports means higher prices, for it means far less energy security. The destruction of our production infrastructure means it will take years to restabilize production to just pre-hurricane levels, and hurricane season isn’t over yet. NG is an absolute disaster now. |
