- Citigroup’s team expects a colder-than-normal winter, which it says would be good news for stocks such as Chesapeake Energy (NYSE:CHK), Southwestern Energy (NYSE:SWN), Cabot Oil & Gas (NYSE:COG), Eclipse Resources (NYSE:ECR), Rice Energy (NYSE:RICE) and Range Resources (NYSE:RRC).
- Citi's 2016 composite spot natural gas price forecast of $3.00/MMBtu is based on the assumption of normal weather going forward, but a 4% colder-than-normal winter, all else being equal, would lift its 2016 composite spot forecast to $3.20/MMBtu.
- But Citi says its outlook for much colder temperatures in the Northeast also carries the risk of hurting Appalachian and Utica producers if well freeze-offs and operational disruptions occur, as has often happened in the past during periods of extreme cold or harsh weather.