Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Stocks Crossing The 13 Week Moving Average <$10.01 -- Ignore unavailable to you. Want to Upgrade?

To: J.B.C. who wrote (7297)	1/2/2001 8:31:45 PM
From: gamesmistress	Respond to of 13094

It's not Joe Consumer driving up the price of natgas, it's the increasing use of natgas to power electrical plants combined with the reluctance of the oil/gas producers to drill more until now, given the price they were getting the past couple of years. Nobody thinks $9 - $10/mcf is sustainable for long, but with the increased demand plus the time it takes to get more supply available, it's not going back down to $3/mcf anytime soon. If you go to simmonsco-intl.com the speech "Outlook For Natural Gas: Is A Train Wreck Pending?" presented by Matthew R. Simmons, is a good and readable summary of the reasons for this crisis. (Free registration)

To: J.B.C. who wrote (7297)	1/2/2001 10:32:41 PM
From: Bucky Katt	Respond to of 13094

Whether we agree on the reasons or not, the fact is prices are up, and it was a great long bet. And, there are many producers that are going to have huge yoy earnings increases going forward. You need to look at storage figures to understand just how squeezed the natgas market became. And because of years of flat prices, not many new gas fields were being drilled. Did traders make it worse? Of course, that is the way it works. And demand is up, storage supplies down, and part of the reason are those natgas fired electric generation plants, and cheap gas was the reason they were built in the 1st place. But then again, a well managed utility is probably holding natgas winter delivery contracts for 4-4.50 bucks per mcf. It's the ones that didn't hedge that are buying in the cash market, and they, and their customers are getting creamed, big time. It is more complicated than that, but those are facts. I was long them from 2.75 per, but got out a bit too early...the Feb futures were down 15% today. A look at natgas futures out 6-12 months, and you will see the squeeze is now, not later. I trade energy futures when I sense a grand slam coming, and I was buying crude long when it was $10 per barrel, which seems like a long time ago. And if the mid-east ignites, or this opec output cut sticks, we go back to $30+ oil.