Natural gas pricing for the upcoming year

I am going to predict that pricing for natural gas for the next 12 months will be higher than the previous 12. I base this upon how low the natural gas storage levels are right now. This is obviously very good for the industry and landowners whose property is in production.

From the EIA:

There are currently 22 more weeks in the injection season, which traditionally occurs April 1 through October 31, although in many years injections continue into November.  EIA forecasts that the end-of-October working natural gas inventory level will be 3,405 Bcf, which, as of May 30, would require an average injection of 87 Bcf per week through the end of October. EIA's forecast for the end-of-October inventory levels are below the 5-year (2009-13) average value of 3,837 Bcf. To reach the 5-year average, average weekly injections through the end of October would need to be 106 Bcf.

The weekly natural gas storage report can be found here: http://ir.eia.gov/ngs/ngs.html

 

Does anyone have other insights?

 

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Replies to This Discussion

Permalink Reply by Elnathan Cory on June 12, 2014 at 3:35pm

I hope your equation has a place to plug in the militant takeover of OPEC's number two oil producer!

Permalink Reply by Joe Shervinski on July 22, 2014 at 11:31am

I wish I knew where the support is and I was hoping the market was just headed far enough to close a couple of gaps, but we passed those points already and even begun to gap down. Is this an exhaustive gap or is the train headed south full speed ahead? I don't know at this point, but on the futures we have lost 25% value in just 6 weeks. This is one Elliot Wave analysts "count" on the gas market:

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