Commodity Trade Mantra

All posts under ‘Natural Gas Trading’

How to Profit from a "Bad News" Natural Gas Trade

There’s reason to believe that natural gas can begin a sustained run higher here into the fall. US oil production is declining sharply. Both short & medium-term, natural gas producers are probably in a better place than oil producers. Demand is not rising quite as much as once predicted, but with more power plants switching from coal to gas, consumption will pick up.

Beware: Fracking Is Where Money Goes to Die

The fracking boom has been cash-flow negative for oil and gas drillers from the very beginning. The steep decline rates of fracked wells force producers to drill more wells just to keep production and revenues flat. They fund this drilling with debt. To support that growing debt, they have to produce more & take on even more debt.

Chevron Terminates All Shale Gas Exploration In Europe

The US Energy Information Agency first estimated that Romania had enough shale gas reserves to supply the country for more than a century, but on exploration failures it looks like Romania does not have shale gas. So a SHALE ENERGY BANG turned into a WHIMPER as Chevron’s shale gas exploration projects turned out to be an utter failure.

The Russian Empire Strikes Back

The Russians will get through these & even further sanctions from the United States. Natural gas in Europe currently sells at more than a 100% premium to North American natural gas prices. When US imposes a sanction on Russian uranium, then its serious. Until then, current sanctions are nothing more than political posturing.

US Natural Gas Will Never Replace Russian Gas For Europe

Even with the shale plays, in April 2014 the US remains a net gas importer. In 2013, the most recent full year of data, the US had to import 1.3 trillion cubic feet to satisfy domestic Natural Gas consumption. The numbers don’t add up, and they never will, also due to simple economics.

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