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Gold/Mining/Energy : Big Dog's Boom Boom Room -- Ignore unavailable to you. Want to Upgrade?

To: quehubo who wrote (62046)	3/25/2006 9:46:16 AM
From: Keith J	Read Replies (1) \| Respond to of 206281

Que, I can't understand why the futures market has NG so high for later in 2006 and early 2007. It's almost back to the standard 6:1 ratio with crude, but the market doesn't seem to think that demand will suffer at this higher price, which we have pretty good indication from the last several months that high NG prices are choking off significant demand. Not to mention we are looking a possibly record storage levels going into the winter. If I was a producer, I'd be saying thank you and hedging more here. KJ

To: quehubo who wrote (62046)	3/25/2006 9:57:59 AM
From: ChanceIs	Respond to of 206281

>>>with present ng prices less ng will be consumed than last year for generation this Spring.<<< You are probably correct. The only caveat would be the rail constraints on coal, and the aggressiveness with which the coal generators choose to do maintenance in prep for the summer. I had posted in the last week that a coal generator in the north (Illinois???) had twice reduced output this year for want of coal. Credits aren't cheap either. >>>Sentiment will change once it is apparent that storage injections will be healthy and there still is no recovery in demand from the price spike that started last August.<<< I am caught a little off guard here with the NG/E&P/OSX rally this week. I am still short by in large with covered puts to hedge. I had figured that we would wallow sideways for at least another month. I am of similar mind to you on the NG builds. I see that overhang, which could build, and don't want to commit. The strip is telling me I am all wrong and current inventories don't matter. If it were easy......