Natural Gas
Seems like a smart bunch in here so I thought I'd get some input. Anyone track natural gas? Thoughts on where the price will settle next year?
Seems like a smart bunch in here so I thought I'd get some input. Anyone track natural gas? Thoughts on where the price will settle next year?
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I should clarify - I'm speaking specifically to Henry Hub NG
It depends on this coming winter. If we get very cold winter, I would expect prices to go higher to $3.50, otherwise I would expect to trader around $3-$3.25. There is so much gas and we haven't seen any sign of slow down in production. Currently, coal to gas switching is supporting the price.
Yeah, I was wondering if we've seen the majority of the coal-to-gas switching already occur? NG is used primarily for cooling days, so demand could possibly slacken a little in the winter? I guess the concern is that there are fewer and fewer rigs that are producing more and more NG. Couple that with the administrations pressure on coal and it paints a potentially grim picture. Coal seems to become competitive with NG at ~$3/MBtu so can NG really maintain these lows?
Yes, majority of switching has occurred, but coal prices are going down too so at $3.00 or higher I would expect switching to slow down.
I could still foresee sub $3 / Mcf gas at the turn of the year, $3.50 is feasible but seems optimistic.
Anyone know how the ibanks construct their forecasts?
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