Natural Gas

[winston]

Natural Gas: What Do the Insiders Know?

By Eric Fry

The year-over-year level of natural gas inventories has declined every single week this year.

The number of natural gas rigs in operation is no longer increasing. The rig count topped out two months ago and remains 80% below the peak levels it hit in 2010.

Insiders are buying their own stock at several natural gas companies. This insider buying is taking two forms…
1. Company stock buybacks
2. Individual purchases by company officers and directors.

Source: The Oxford Club

https://energyandresourcesdigest.com/na ... ?src=email

[winston]

Heating Costs Will Rise, Cold Winter Forecasted

Winter is coming. Heating costs will increase in double-digit range this winter, thanks largely to colder weather and higher energy costs.

US Energy Information Administration has forecasts that average household expenditures for all major home heating fuels will rise this winter because of expected colder weather and higher energy costs.

Natural gas expenditures are forecast to rise by 12%, while home heating oil by 17%, electricity by 8%, and propane by 18%.

Most of the increase reflects expected colder weather rather than higher energy costs, EIA said.

Meteorology company Accuweather has predicted that the Northeast, Northwest and Rockies will receive above average snowfall conditions in 2017-18 winter.

National Oceanic and Atmospheric Administration has forecast that the coming winter would be 13 percent colder than last winter.

Lower temperatures mean more fuel consumption as households will use more energy to heat up their homes.

According to EIA, nearly half of all U.S. households heat primarily with natural gas. EIA expects households heating primarily with natural gas to spend $69 or 12% more this winter compared with last winter.

Source: RTT

[winston]

U.S. set for mild winter

The U.S. Federal Energy Regulatory Commission said that an upcoming mild winter meant that it does “not see major risk factors that would likely lead to significant market disruptions during this winter,” undercutting the rationale for Sec. of Energy Rick Perry’s proposal to prop up coal and nuclear power plants.

Mild temperatures could also keep a lid on natural gas prices and put further pressure on coal.

Source: Oil Price Intelligence

[winston]

China Drives Natural Gas Demand Boom

by Tsvetana Paraskova

For much of the past two decades, China has been the main driver of global oil demand growth. In the coming two to three decades, Chinas expected to become the leading determinant in global natural gas demand as well, outpacing the U.S. as the biggest natural gas consumer at some point between 2040 and 2050.by

Economic and industrial production growth, coupled with efforts to reduce stifling pollution levels, will lead China’s surging natural gas demand over the next couple of decades, according to analysts and international projections.

The latest forecast for China’s upcoming leading role in the world’s natural gas market comes from Sanford C. Bernstein & Co, whose analyst Neil Beveridge said in a research note earlier this week:

China’s gas consumption is expected to rise to 300 billion cubic meters (bcm) in 2020 from 206 bcm in 2016, and surge to 600 bcm by 2040. After that, China is seen outstripping the U.S. in natural gas consumption to become the biggest user of the fuel in the world, according to Bernstein.

The biggest risk to the expected natural gas demand surge is renewables rising more than currently projected and therefore narrowing the timeframe in which gas will serve as the ‘bridge fuel’ between coal and clean energy.

The International Energy Agency (IEA) sees global gas demand growing 1.6 percent annually until 2022, with China making up 40 percent of this growth.

Consumption in China is expected to increase to almost 340 bcm by 2022, of which imports will account for 140 bcm, up from 70 bcm last year, according to IEA’s Gas 2017 report. In addition, China’s domestic production is seen growing by around 65 bcm to 200 bcm by 2022, with annual growth of 6.6 percent, which would make the country the world’s fourth-largest natural gas producer by 2022.

China is already setting the stage for a natural gas import boom, with imports running at record rates as Beijing pushes on with its cleaner energy agenda that should see the country satisfy 10 percent of its energy needs with gas in 2020, from 5.9 percent in 2015.

By 2035, Chinese gas demand will be treble the 2016 levels, according to Wood Mackenzie.

Last year, China’s gas demand accounted for just 6 percent of its fuel mix, but the government aims to increase this to around 15 percent by 2030, WoodMac’s Kerry-Anne Shanks, Vice President, Gas & Power Asia-Pacific, said in the five takeaways from a recent Gas and LNG Summit.

“While it is unclear if this fuel mix goal will be reached, even minor gains in share translate into big numbers. Presenters showed forecasts for China’s gas demand increasing to 450–600 bcm by 2030,” Shanks noted.

The BP Energy Outlook 2017 sees China’s energy mix evolving through 2035, with coal’s dominance dropping from 64 percent in 2015 to 42 percent in 2035, and natural gas nearly doubling to 11 percent.

BP sees Chinese demand for oil surging 61 percent, and gas demand soaring 186 percent by 2035.

Source: Oilprice.com

https://finance.yahoo.com/news/china-dr ... 00957.html

[winston]

Natural Gas - Lower: US$2.80 from US$2.91 last week from US$3.00 two weeks ago
a. Support US$2.80; US$1.70; Resistance US$4.00
b. Heating, Cooking, Transportation, Fertiliser, Chemical Industry, Fabrics, Glass, Steel, Plastics Paint etc
c. High: US$13.69 (2008); Low: US$1.61 (March 2015)
d. Natural Gas Rigs: Dropped from 1,606 (2008) to low of 81. Now at 185
e. Panama Canal Expansion: Europe & Asian markets expanding
f. Suppy increasing by 4% pa; Demand growing by 7% pa
g. Natural-gas stockpiles rose 2b cubic feet versus expected 7.8b cubic feet
h. Storage levels is about 15% above the 5 yr average
i. Glut of LNG will persist in the 2020s but the market will tighten in the late 2020s
j. Between 2015 and 2030: Demand 2% pa. LNG demand 4.5% pa
l. What are the effects from NAFTA renegotiations?
j. Yoy inventories has declined every single week this year
k. Insiders are buying their own stock at several natural gas companies
l. Unusual warm weather for October
m. When Clean Power Plan is repealed, would natural gas suffer ?
n. China's Demand: 206 bcm in 2016 to 300 bcm in 2020 to 600 bcm in 2040
o. IAEA: 1.6% growth pa until 2020

[winston]

Natural Gas Price Squeeze

The reason why American natural gas prices have plummeted boils down to two things:
1. An excess of supply
2. Unusually warm weather.

Most of the retreat is tied to the supply side.

A stable floor at $3 will encourage some new drilling (since it is marginally profitable in many drilling basins at that price).

First, at least 80-85% of natural gas drilling expenses are front-loaded.
Second, primary production flow - especially from shale and tight gas formations - occurs in the first 18 months.

As demand continues to accelerate, especially as Beijing increasingly moves from coal to natural gas for electricity production, China will be increasingly relying on LNG imports.

Source: Oil Energy Investor

[winston]

It’s not just the cold weather — here’s what else could make natural gas a buy in 2018

by Rebecca Ungarino

Natural gas plummeted this year, declining nearly 20 percent.

A forecasted cold stretch could buoy prices into January.

This comes as the U.S. exports more natural gas.

Markets appear to be waking up to expected natural gas inventory drawdowns.

Source: CNBC

https://www.cnbc.com/2017/12/29/its-not ... yptr=yahoo

[winston]

Buy These 3 Stocks to Soar Thanks to China’s Hunger for Clean Skies

by Tony Daltorio

Source: Investor's Alley

https://www.investorsalley.com/buy-thes ... mcdsingtmc

[winston]

China’s natural gas imports hit record high in December as winter bites

Purchases rise 20 per cent from previous peak a month earlier to 7.89 million tonnes, customs agency says

Imports for the whole of 2017 jumped 27 per cent from 2016 to a record 68.57 million tonnes.

Record imports by state energy firms and higher Chinese production have pushed down domestic wholesale LNG prices in north China. Prices were about 5,500 yuan (US$845) per tonne this week, down 45 per cent from peaks seen in late December.

Source: SCMP

http://www.scmp.com/news/china/economy/ ... nter-bites

[winston]

Natural gas prices jump on inventory decline

Natural gas inventories fell sharply last week, taking total stocks down to 2,296 Bcf, which is lower than even the lower range of the five-year average.

The market is tighter than it has been in years, and Nymex prices for front-month delivery jumped to $3.50/MMBtu this week, surging on fears of tight supplies.

However, that price is still relatively moderate compared to how high prices spiked in the past.

The sanguine outlook stems from the expected tidal wave of fresh supply coming this year from shale gas fields.

Source: Oil Price Intelligence