Strictly: Drilling and oil-field services Message Board

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Gold/Mining/Energy : Strictly: Drilling and oil-field services

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To: Second_Titan who wrote (85832)	1/31/2001 9:12:10 PM
From: isopatch	Read Replies (1) of 95453

Que-7. Must be industry contact day(G). Just read an email from a geologist friend whose spent most of his career working in Texas exploring and drilling for oil and NG. Back in early Jan, my forecast of a NG correction "well into the 5s" in the next several months was met with a storm of protest on the thread. Am frankly amazed that we've dipped below $6/mcg ALREADY! But what could really nail NG E&P stocks isn't just a quick drop. We have to stay down to take the E&Ps down say 25% or more, from here. OS and drilling stocks look to be showing better relative strength than the E&Ps. So they could fare better. In that context, thought this excerp from my friend's email was quite sobering. In fact a good deal MORE bearish than I've been in my posts on the thread! "I just feel (think) that while Ngas will be 4-5 mcf this Spring that the Momentium - cattle will move back to tech stocks - just the reverse of last March. Ngas stocks go down & tech stocks go up - Alan Greenspan saves the day for tech stocks. Even though Ngas profits will be up, the price of Ngas stocks will fade this spring/summer." Haven't made up my mind whether I agree with those NG prices or not. Certainly were such a further price decline in NG to occur with a large flow of funds into tech (for even a month or two Bear Market rally)the sector rotation we've seen over the past year would create a "giant sucking sound" as money is pulled out of the NG E&Ps, causing their prices to drop sharply from recent levels. Based on his background, experience and the MANY emails we've exchanged during the past year, have learned to treat his opinions with a healthy respect. Isopatch

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