Seeking Alpha

The Aft Deck's  Instablog

The Aft Deck
Send Message
Shayne Heffernan is an Economist, Trader, Fund Manager and Venture Capitalist based in Asia. He also serves as Editor and contributor at www.livetradingnews.com, Founder of The Heffernan Group and currently building the company's financial services business in China. Major shareholder and CEO... More
My blog:
Live Trading News
  • Natural Gas a Strong Buy 0 comments
    Jan 26, 2011 2:15 AM | about stocks: WES, UNG

    Natural Gas is a strong buy as the annual Spring sell-off begins. Traditionally Natural Gas gets sold off as the end of winter approaches, however this tradition will come in for some big changes.

    As with most of our investment decisions we are not looking at the short term, we are always looking to buy quality assets that have a good long term outlook. At the current prices, Natural Gas fits that criteria.

    Nymex Natural gas prices fell yesterday as concentration switched from the expiring February contract to March. The Henry Hub March contract fell over 3% as warmer weather loomed in the Midwest in the latest short term forecasts. Gas opened at $4.796 and fell as low as $4.576 before the pit closed at $4.598. Support today is seen at $4.534 and $4.494 with resistance at $4.666 and $4.702.

    Why Natural Gas be a long term winner?

    World primary energy consumption grew by 45 percent over the past 20 years, and is likely to grow by 39 percent over the next 20 years. Global energy consumption growth averages 1.7 percent p.a. from 2010 to 2030, with growth decelerating gently beyond 2020, according to the BP Energy outlook 2030.

    In 2009 the world’s proven gas reserves amounted to 187.5 trillion cubic meters, which at current production levels will be sufficient for the period to 63 years.

    As expected, natural gas by 2030 will be a fuel observing the most rapidly growing demand.

    Asia will be the main source of production growth and demand for gas. China’s share will amount to 56 percent growth in gas demand in the region.

    The share of the Middle East, which is the second largest source of production growth and demand for gas in 2030, will comprise 17 percent of global demand for fuel compared to 12 percent in 2010. Its share in the growth of global gas production will increase from 15 percent in 2010 to 19 percent in 2030.

    LNG imports will grow. Annual growth in LNG supply will amount to 4.4 percent by 2030. Its share in world gas supplies will increase from 9 percent in 2010 to 15 percent in 2030.

    In Europe, the share of LNG in total imports will increase from 30 percent in 2010 to 42 percent in 2030.

    Full Report
    Themes: natural gas, hpgs, strong buy Stocks: WES, UNG
Back To The Aft Deck's Instablog HomePage »

Instablogs are blogs which are instantly set up and networked within the Seeking Alpha community. Instablog posts are not selected, edited or screened by Seeking Alpha editors, in contrast to contributors' articles.

Comments (0)
Track new comments
Be the first to comment
Full index of posts »
Latest Followers

StockTalks

More »

Latest Comments


Posts by Themes
Instablogs are Seeking Alpha's free blogging platform customized for finance, with instant set up and exposure to millions of readers interested in the financial markets. Publish your own instablog in minutes.